aehi_10k-123111.htm

10-K 1 aehi_10k-123111.htm FORM 10-K aehi_10k-123111.htm

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-K

(Mark One)

[x]	Annual Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 and

For the fiscal year ended December 31, 2011

[_]	Transaction Report pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from _________ to _____________

Commission file number: 000-53451

ALTERNATE ENERGY HOLDINGS, INC.

(Exact name of registrant as specified in its charter)

Nevada

(State or other jurisdiction of

incorporation or organization)

20-5689191

(I.R.S. Employer

Identification No.)

911 E. Winding Creek Dr., Suite 150, Eagle, Idaho 83616

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (208) 939-9311

Securities registered pursuant to Section 12(b) of the Act: None

Securities registered pursuant to Section 12(g) of the Act:

Common Stock, par value $.001 per share

(Title of class)

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act. Yes [_] No [x]

Indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or Section 15(d) of the Act. Yes [_] No [x]

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [_] No [x]

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes [_] No [_]

Indicate by check mark if disclosure of delinquent filers pursuant to Item 405 of Regulation S-K is not contained herein, and will not be contained, to the best of registrant’s knowledge, in definitive proxy or information statements incorporated by reference in Part III of this Form 10-K or any amendment to this Form 10-K. [_]

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act. (Check One).

Large accelerated filer	[_]	Accelerated filer	[_]
Non-accelerated filer	[_]	Smaller reporting company	[x]
(Do not check if a smaller reporting company)

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes |_| No |X|

The aggregate market value of the voting and non-voting common equity held by non-affiliates of the registrant was approximately $34,605,000 as of June 30, 2011 (the last business day of the registrant’s most recently completed second fiscal quarter), based on the average bid and asked price of such common equity as quoted by the Pinksheets on such date.

The number of shares outstanding of the registrant’s common stock as of April 3, 2012, was 326,562,791 shares.

TABLE OF CONTENTS

PART I	Page

ITEM 1 Business	1
ITEM 1 A Risk Factors	1
ITEM 1 B Unresolved Staff Comments	25
ITEM 2 Properties	25
ITEM 3 Legal Proceedings	25
ITEM 4 Mine Safety Disclosures	25
	26
PART II
ITEM 5 Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	26
ITEM 6 Selected Financial Data	27
ITEM 7 Management’s Discussion and Analysis of Financial Condition and Results of Operations	28
ITEM 7A Quantitative and Qualitative Disclosures About Market Risk	31
ITEM 8 Financial Statements and Supplementary Data	31
ITEM 9 Changes in and Disagreements with Accountants on Accounting and Financial	31

ITEM 9 A Controls and Procedures	32
ITEM 9 B Other Information	33

PART III
ITEM 10 Directors, Executive Officers, and Corporate Governance	33
ITEM 11 Executive Compensation	36
ITEM 12 Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters	40
ITEM 13 Certain Relationships and Related Transactions, and Director Independence	41
ITEM 14 Principal Accounting Fees and Services	42

PART IV
ITEM 15 Exhibits, Financial Statement Schedules	42

SIGNATURES	44

iii

PART I

In this Annual Report, the terms “we”, “us”, “our”, “Company” , “AEHI” and “Alternate Energy Holdings” refer to Alternate Energy Holdings, Inc. and our wholly owned subsidiaries. This Annual Report contains forward-looking statements that involve risks and uncertainties. The inclusion of forward-looking statements should not be regarded as a representation by us or any other person that the objectives or plans will be achieved because our actual results may differ materially from any forward-looking statement. The words “may,” “should,” “plans,” “believe,” “anticipate,” “estimate,” “expect,” their opposites and similar expressions are intended to identify forward-looking statements, but the absence of these words does not necessarily mean that a statement is not forward-looking. We caution readers that such statements are not guarantees of future performance or events and are subject to a number of factors that may tend to influence the accuracy of the statements, including but not limited to, those risk factors outlined in the section titled “Risk Factors” as well as those discussed elsewhere in this Annual Report. You should not unduly rely on these forward-looking statements, which speak only as of the date of this Annual Report. We undertake no obligation to publicly revise any forward-looking statement to reflect circumstances or events after the date of this Annual Report or to reflect the occurrence of unanticipated events. You should, however, review the factors and risks we describe in the reports that we file from time to time with the Securities and Exchange Commission (“SEC”) after the date of this Annual Report.

Item 1. Business

Introduction

We were incorporated in the State of Nevada on July 31, 2001, and commenced operations in August 2005, and were formerly know as Nussentials Holdings, Inc. Subsequently, Sunbelt Energy Resources, Inc. was formed on August 29, 2005 to operate in the alternate energy industry. Sunbelt has experienced limited operational activity. In September 2006, Sunbelt acquired Nussential Holdings, Inc. by exchanging 17,900,000 shares of Sunbelt for 100% or 21,399,998 shares of the common stock of Nussential Holdings. As a result of the acquisition, the shareholders of Sunbelt owned a majority of the voting stock of Nussentials Holdings, and Sunbelt changed its name to Alternate Energy Holdings, Inc. The transaction was accounted for as a reverse merger, whereby Alternate Energy Holdings, Inc. was the acquirer, which resulted in the recapitalization of Alternate Energy Holdings, Inc. Simultaneously with the reverse merger, Nussentials Corporation, a wholly-owned subsidiary of Nussentials Holdings, Inc., was transferred to Nussential Holdings, Inc. through issuance of 4,252,088 shares of common stock.

In October 2008, we filed a Form 10-SB with the Securities and Exchange Commission, and thereafter became a public reporting company under the Securities Exchange Act of 1934, as amended. Our common stock is currently traded under the symbol AEHI.PK.

We are a development stage enterprise engaged in the purchase, optimization and construction of green energy sources, primarily nuclear power plants. Alternate Energy Holdings, Inc. was founded by former senior executives of the utility and finance industries to effectively address several aspects of the “energy crisis”: dependency on sources of foreign oil, global depletion of fossil fuel reserves, renewable energy, global warming and power plant emissions.

Our corporate offices are at 911 E. Winding Creek Dr., Suite 150, Eagle, ID 83616. We maintain a corporate website at www.alternateenergyholdings.com, and websites for our subsidiaries at www.energyneutralinc.com and www.greenworld-h2o.com. The information on or which may be accessed though the foregoing websites is not incorporated in, and is not a part of, this Annual Report.

As depicted below, Alternate Energy Holdings, Inc. is a holding company that consists of four active corporate entities: Idaho Energy Complex, Reactor Land Development, LLC, Green World Water, LLC and Energy Neutral, LLC. We also have one inactive subsidiary, International Reactors Incorporated, a Nevada corporation.

Alternate Energy Holdings, Inc. a Nevada Corporation
	\|
Idaho Energy Complex, LLC (An Idaho Limited Liability Company) 100%	Green World Water, LLC (An Idaho Limited Liability Company) 100%	Energy Neutral, LLC, (an Idaho Limited Liability Company) 100%
\|		\|
Reactor Land Development, LLC, (A Delaware Limited Liability Company) 99%		Energy Neutral Development Group, LLC (an Idaho Limited liability Company) 100%

Idaho Energy Complex, LLC was formed to oversee a proposed $10 billion nuclear project near Payette, Idaho, with an adjacent backup site. Reactor Land Development, LLC is engaged in acquiring funds for land and water rights, permits and licenses, and plant development rights. Green World Water, LLC™ assists developing countries with power generation as well as the production of potable water. Energy Neutral, LLC™ designs and constructs homes intended to be “energy neutral” (e.g., they consume less energy than they generate) and assists homeowners, businesses and farmers with reducing energy consumption and reliance on the electrical grid.

Business Strategy

We intend to service the electric power generation industry by acquiring and developing nuclear plant sites and obtaining licenses for their construction and operation throughout the United States. The initial proposed energy complex (which we refer to as “the Project”) is in the State of Idaho. We intend to be an independent power producer and are in the process of obtaining permits for the site, which will include one or more nuclear reactors. We plan to meet the growing needs of the marketplace by providing reliable, low cost, large-scale power production on a national scale and, in addition, offering emerging demand-side and power management technologies to reduce energy consumption by homes, and commercial and agricultural businesses.

During the fourth quarter of 2009, our Idaho Energy Complex subsidiary entered the local land use approval process for the Project, and received initial approval from the Payette County Planning and Zoning Commission in November 2009. During 2010, we received the approval for our comprehensive plan from the Payette County Commissioners, and approval for the required rezoning of the proposed site from the Payette County Planning and Zoning Commission. We received final rezoning approval by the Payette County Commissioners in June 2011. In August 2011 we entered Phase 1 of the Project in which we entered into an agreement with Enercon Services, Inc. ("ENERCON") pursuant to which ENERCON will provide, on a fixed price basis, engineering, licensing, environmental and other technical support as necessary to develop for us a Combined Construction and Operating License Application ("COLA") for two nuclear generating units to be located at the proposed site in Payette County, Idaho ("Phase I Services"). Under the agreement, the Registrant is obligated to pay ENERCON a fixed price of approximately $30 million for the Phase I Services over approximately 3 years. Following the preparation of the COL application and our submittal of the COL application to the Nuclear Regulatory Commission ("NRC"), ENERCON shall provide support services during the NRC's review process ("Phase 2 Services"). The Phase 2 Services will be provided by ENERCON on a time and materials basis which is currently estimated to be approximately $10.4 million. We expect to begin the approval process by the end of 2012 and it may last as long as three to five years. In January 2012 we announced that we’d filed a 60-day notice with Payette County, Idaho in preparation of federal site approval work related to our proposed nuclear power plant. The notice was a key prerequisite for the next phase of the project. It is also part of the company's legal obligation to Payette County prior to beginning any official work including core boring, environmental study, and installation of meteorological survey towers as part of the federal COLA process.

In August 2011, we entered into an agreement with Enercon Services, Inc. ("ENERCON") pursuant to which ENERCON will provide, on a fixed price basis, engineering, licensing, environmental and other technical support as necessary to develop for us a Combined Construction and Operating License Application ("COLA") for two nuclear generating units to be located at the proposed site in Payette County, Idaho ("Phase 1 Services"). Under the agreement, the Registrant is obligated to pay ENERCON a fixed price of approximately $30 million for the Phase 1 Services over approximately 3 years. Following the preparation of the COLA application and our submittal of the COLA application to the Nuclear Regulatory Commission ("NRC"), ENERCON shall provide support services during the NRC's review process ("Phase 2 Services"). The Phase 2 Services will be provided by ENERCON on a time and materials basis which is currently estimated to be approximately $10.4 million. We expect to begin the approval process in 2012 and it may last as long as three to five years. In January 2012, we announced that we’d filed a 60-day notice with Payette County, Idaho in preparation of federal site approval work related to our proposed nuclear power plant. The notice was a key prerequisite for the next phase of the project. It is also part of the company's legal obligation to Payette County prior to beginning any official work including core boring, environmental study, and installation of meteorological survey towers as part of the federal COLA process.

We plan to finance the Idaho Energy Complex with a combination of secured debt, Federal government loan guarantees, unsecured debt, equity and equity-linked securities and other forms of financing that may be available to us, subject to future market conditions. In this regard, in March 2012, we entered into two related agreements with unrelated third parties pursuant to which we will be entitled to receive up to 45,900,000 Euros ($60,190,863 US dollars) in six installment payments over approximately the next 200 days, as described in greater detail below. First, we entered into a Financial Instrument Service Agreement (the “Financial Services Agreement”) with Vital Funds, Inc. (“Vital”). Pursuant to the Financial Services Agreement, Vital, in consideration of payment by us of an initial fee of US$2,575,000, is obligated to arrange for an undisclosed third party to deposit 76.5 million Euros with a bank (the “Issuing Bank”), which is to be Credit Suisse, Zurich, NatWest, London or HSBC Hong Kong, or similar quality bank agreed to by us. The 76.5 million Euros are to be held in a blocked account at the Issuing Bank for one year and a day. On the basis of that deposit the Issuing Bank thereafter is to issue a bank guarantee (“Bank Guarantee”) ($101,984,770 US dollars) in the amount of 76.5 million Euros ($101,984,770 US dollars) for the term of a year and a day. The Bank Guarantee will be issued in favor of AEHI, but expressly for the benefit of Swiss Asset Manager Ltd (“Swiss Asset Manager”). The US$2,575,000 fee we are obligated to pay to Vital has been deposited by us into an escrow account maintained by a third party. Upon proper confirmation of the Bank Guarantee by the bank of Swiss Asset Manager (the “Confirmation”) as outlined in the Financial Services Agreement, Vital shall be entitled to receipt of the US$2,575,000 fee. If the conditions set forth in the Financial Services Agreement are not satisfied, we are entitled to the return of the funds deposited into escrow. We also entered into a separate Project Funding Agreement (the "Funding Agreement") with Swiss Asset Manager regarding the Bank Guarantee. Subject to satisfaction of certain conditions set forth in, and at the times specified in the Funding Agreement, Swiss Asset Manager is obligated to pay us a total of 45,900,000 Euros (61,190,863 US dollars) in six installments in consideration for Swiss Asset Manager's use of the Bank Guarantee. It is anticipated that we could receive the first installment payment from Swiss Asset Manager of 11,475,000 Euros ($15,297,715 US Dollars) fifteen banking days following the Confirmation, with five additional disbursements every thirty banking days thereafter for an aggregate additional amount of approximately 34,425,000 Euros ($45,893,147 US Dollars). There is no guarantee that we will receive all, or any, of the funds we are entitled to under the Funding Agreement. Exchange rates were used as of the date of this filing and may fluctuate at the time of the funding.

As the Idaho Project moves through the extensive regulatory approval process, the Company is developing other revenue opportunities through its other subsidiaries. Through Green World Water, LLC we are currently working with China National Nuclear Corporation to develop and build a desalinization reactor to market to developing countries needing potable water and electricity. The Company is currently marketing these reactors in the Middle East and Africa. The lead time to order such a reactor is twelve (12) months, at an estimated cost of $2.5 to $3 billion.

Our Energy Neutral, LLC subsidiary, which is focused on assisting homeowners, businesses and farmers with reducing energy consumption and reliance on the electrical grid, completed construction of six homes designed and constructed to be energy neutral, i.e., they consume less energy than they generate, with excess energy generation being placed back on the public utility grid. Five of these homes and one model home were sold during 2011, representing our first revenues, for gross sales proceeds of approximately $923,650. The newly-sold five Energy Neutral homes were built in the Panther Creek subdivision of West Boise, Idaho, and are in the same neighborhood which was designed to conserve electricity through energy-efficient construction methods and appliances. The model house, which resides on Scotfield Court in Boise, was built as the first Energy Neutral model home to meet stringent energy-efficient standards, but also produces more electricity than it consumes during most days through a series of low-profile solar panels. We plan to begin franchising the Energy Neutral Brand and concept to developers and builders in a few select markets starting in 2012.

Industry Overview

According to the Nuclear Energy Institute (“NEI”), an independent industry organization, in 2011 nuclear power plants provided 17% of the world’s electricity and nearly 19.2% of the electricity in the United States. As reported by the NEI, nuclear energy is the United States’ largest source of emission-free electricity and second largest source of power. According to the European Nuclear Society, as of February 2, 2012, there are a total of 435 nuclear power plants operating in plants in 30 countries and 63 plants with in countries under construction. In the United States, 65 nuclear power plants are in commercial service operating a total of 104 nuclear reactors. On a global basis, the collective installed-electric-net-capacity of nuclear power plants is 368 gigawatts, or GW.

Nuclear Power Plants as of 2011-01-19

Number of Reactors in Operation Worldwide

As of January 19, 2011, there are another 65 plants, with an installed capacity of 63 GW, are under construction in 16 different countries. In addition, on a worldwide basis, 500 plants are either planned, proposed or under consideration.

Number of Reactors under Construction Worldwide

The last two power plants built in the United States were the Watts Bar plant, which began construction in 1973, was completed in 1990, and did not begin commercial operation until 1996, and the River Bend plant, which was built in 1977 and went online in 1986. In 2010, President Obama announced that his administration has approved an $8.3 billion loan guarantee to build the first domestic nuclear power plant in three decades at Plant Vogtle in Waynesboro, Georgia site. The two new Vogtle Plants were approved for construction and subsequent operations by the Nuclear Regulatory Commission in February 2012. On February 16, 2010, President Obama said, “… this one plant will cut carbon pollution by 16 million tons each year when compared to a similar coal plant. That’s like taking 3.5 million cars off the road.” As reported by the New York Times on March 17, 2011, the Obama administration has requested that, subject to congressional approval, $36 billion be appropriated for the nuclear loan guarantee program.

We believe nuclear energy represents the most “eco-efficient” of all energy sources because it produces the most electricity in relation to its minimal environmental impact. In addition, nuclear power plants do not emit harmful gases, require a relatively small area, do not deplete natural resources (such as fossil fuels), and effectively mitigate other impacts. As a result, they cause no significant adverse effects to water, land, habitat, species and air resources.

Additionally, we believe nuclear power has the lowest production cost and highest capacity factor of the major sources of electricity. Nuclear is a chief contributor to national energy security and is not subject to unreliable weather or climate conditions, unpredictable cost fluctuations, or dependence on foreign suppliers. Adding to their reliability, nuclear power plants are designed to operate continuously for long periods of time. They can run from approximately 540 to 730 days at over 90% reliability before they are shut down for refueling.

Overall, worldwide demand for energy is projected to increase 44% between 2006 and 2030, and as a result there is a renewed interest in nuclear power. A Bisconti poll in March 2009 finds 70% of Americans in favor of building new nuclear power plants. NEI polls have found that 84% of Americans live in close proximity to nuclear power plants favor nuclear energy, and 90% positively view the plants.

We believe that nuclear power has economic benefits. Economic impact studies show that construction of a new reactor creates four to five years of jobs for as many as 5,000 workers, of which 1,000 to 1,500 are direct and indirect permanent jobs per unit once the plant begins operating. Salaries in the nuclear industry average about $80,000 per person. Most positions require only a high school education and some specialized training. Each plant (unit) creates well over $2.0 billion in gross domestic product to the local area during construction and over $1.0 billion to the annual state gross domestic product during operations. In addition, communities have found that the construction and operation of plants also improve schools, police and fire services, and medical facilities.

We believe that nuclear power is also safe. In the event of an imbalance in the operations, the sophisticated safety systems of domestic nuclear power plants are designed to automatically shut down, well before any safety margins are exceeded. Unscheduled automatic plant shutdowns rarely occur. Over the years, various improvements in plant maintenance and training programs have decreased the number of automatic plant shutdowns, enabling plants to achieve longer continuous runs. Nuclear plants typically produce power more than 90% of the time, and in August 2007 they posted a 98% capacity factor, according to the NEI.

The industry has also undertaken many measures to improve the security of nuclear power facilities. After the tragic terrorist attack of September 11, 2001, security forces at U.S. nuclear plants have increased by one-third, to approximately 8,000 officers. Other incremental security measures include: extending and fortifying security perimeters; increasing patrols within security zones; installing new barriers to protect against vehicle bombs; installing additional high-tech surveillance equipment, and strengthening coordination of security efforts with local, state and federal agencies to integrate their approaches and responses. Furthermore, the NRC evaluates “force-on-force” drills between security personnel and contractor teams. Every domestic plant is tested with mock adversary drills every three years.

Economic Viability

We believe that the potential profit for nuclear reactors is considerable. Based on third-party data provided by globally recognized experts Constellation Energy and UniStar, each reactor is capable of annually generating positive earnings before interest, taxes, depreciation and amortization (“EBITDA”), assuming no growth. Based on information from the McKinsey Global Institute and Synapse Energy Economics, carbon credits could be as much as double the EBITDA for each reactor (thus, exceeding $2.2 billion annually). Carbon credits produced by nuclear reactors are over $250 million for a plant this size today. In addition, more stringent emissions regulations on fossil fuel plants anticipated to become effective in 2012 in the United States, Europe and elsewhere may substantially increase EBITDA for each reactor.

Our Company

As noted above, we are a holding company comprised of 4 operating corporate entities: Idaho Energy Complex, LLC, Reactor Land Development, LLC, Energy Neutral, LLC, Energy Neutral Development, LLC and Green World Water, LLC (which was formed in 2010, and has succeeded to the business formerly conducted by a fifth, inactive subsidiary, International Reactors Incorporated).

Idaho Energy Complex, LLC

Idaho Energy, an Idaho corporation and 100% wholly-owned subsidiary of the Company that was formed in March 2007, is a proposed $10 billion nuclear complex near Payette, Idaho. Idaho Energy is the manager of Reactor Land, a Delaware limited liability company that is attempting to obtain funding for the nuclear facility land, water rights and NRC operating license. Five thousand acres have been dedicated to the Project, which will provide enough electricity to power Idaho’s growth, as well as generate income through the sale of power to out-of-state markets. The Payette facility will feature a new advanced nuclear reactor design that does not require large amounts of water for cooling. The Company plans to build up to six advanced reactors at Idaho Energy and operate as an Independent Power Production (“IPP”). .

Reactor Land Development, LLC

Reactor Land Development, LLC, a 99% owned subsidiary of Idaho Energy, is a Delaware limited liability company. Reactor Land Development, LLC began operations in September 2007, with Idaho Energy as its manager. Its purpose is to acquire funding for land and water rights, permits and licenses, development rights and such other properties and services necessary to develop approved sites in Idaho for one or more nuclear reactors.

Energy Neutral, LLC

Energy Neutral™, a 100% wholly-owned subsidiary of the Company, assists homeowners, businesses and farmers to operate with minimal or no reliance on the electrical grid. Energy Neutral’s primary services are: design and construction of residential “energy neutral” homes, evaluating existing homes, businesses and farms for conservation and renewable energy potential; drafting plans to attain or approach energy neutrality; and working with wind, conservation and solar suppliers and installers to install products in the marketplace. During 2010 and early 2011, Energy Neutral completed construction of six “energy neutral” homes in Boise, Idaho, which feature unique design elements as well as standard “energy neutral” elements, including the Energy Star certification and solar power generation. As noted above, five homes were sold during the year of 2011, representing our first revenues, for gross sales proceeds of approximately $923,650. We plan to begin franchising the concept to developers and builders in a few select markets starting this year through Energy Neutral Development, LLC, a wholly owned subsidiary of Energy Neutral Group, LLC.

Green World Water, LLC

Green World Water,™ a 100% wholly-owned subsidiary of the Company was formed in 2010 to assist developing countries with power generation, as well as the production of potable water. Green World Water has succeeded to the business of another Company subsidiary, International Reactors Incorporated, a Nevada corporation, which was formed in November 2007 but now is inactive. Green World Water seeks to construct commercial nuclear reactors on oceanfront sites, particularly in Africa and western-friendly Middle Eastern countries to co-generate clean energy and desalinate water. Green World Water believes that advanced nuclear technology can be used to address electrical energy needs while simultaneously producing fresh water from ocean intake. The Company has an agreement with China National Nuclear Corporation (CNNC) to produce desalinization reactors in China to market on a worldwide basis. The Company is currently marketing these reactors in the middle east and Africa

The Project – The Opportunity

According to the U.S. Energy Information Agency, domestic energy consumption is expected to increase 30% between 2005 and 2030. In Idaho, which is the site of the Company’s energy complex, the demand for energy is clear. In the fall of 2007, two major corporations stated that they could no longer consider Boise, Idaho as a possible relocation site because the existing utility infrastructure could not supply sufficient power. At the same time, Idaho ranks last among the 11 Western states for the number of megawatts it plans to bring on-line between 2007 and 2011 according to U.S. Energy Information Administration figures.

The January 2007 Idaho Energy Plan, which was developed by the Interim Committee on Energy, Environment and Technology of the Senate and House of Idaho to investigate the state's energy systems, develop recommendations to achieve reliable, low-cost energy supply, protect the environment, and promoting economic growth, states that Idaho is vulnerable to the economic effects of emissions regulation on the current imported coal power and relicensing of the state’s hydro plants. The January 2007 Idaho Energy Plan also notes that Idaho imports 80% of its power from fossil fuel sources and that the over than $3 billion that Idaho residents spend on energy each year leaves the state. In all, the proposed Idaho Energy Complex is estimated to create enough power for about 1.5 million homes, or three times the number of existing homes in Idaho. The excess power will be sold to the marketplace, primarily on the West Coast.

The Nuclear Provisions H.R. 6 Energy Policy Act of 2005 has created an ideal market atmosphere for the development of new plants. The bill provides an 80%/20% loan guarantee for technologies that avoid, reduce or sequester air emissions, including advanced nuclear plants. Additionally, the energy bill approved provisions supported by the current administration to provide 100% of the cost of delays (when delays are beyond the industry’s control) during construction and at the commencement of operations. The Company plans to take advantage of prevailing political sentiment and actively pursues federal loan guarantees for the Idaho energy complex. In his 2011 budget, President Obama is requesting $36 billion as nuclear project loan guarantees. $8.3 billion of nuclear loan guarantees were awarded in 2010. Idaho Energy’s management intends to apply for the maximum amount of guarantees that are available to the Company under this program.

The Project - Phase 1

After three decades, nuclear power is re-emerging as a necessary component of a well-balanced power generation portfolio. Demand for nuclear plant sites is growing. Stringent NRC criteria limit the number of qualified reactor sites. Fourteen companies, including the Company, have notified the NRC of their intent to file for construction and operating licenses (“COL”) for 34 new units by the third quarter of 2011. All the proposed sites, except the Company’s Idaho site and one in Utah, are east of the Rocky Mountains. We believe the value of attractive sites, particularly in the Western United States, is expected to rise because of the following factors:

·	nuclear generation can be very profitable;

·	global experience has reduced construction and operating costs;

·	costs of electricity from competitive fossil generation plants are rapidly rising due to emissions problems and market forces;

·	coal power plants are no longer a viable option due to global warming concerns;

·	hydroelectric power is in decline as plant relicensing becomes more difficult because of environmental challenges;

·	deregulation of wholesale electric pricing is expected to enable independently-owned nuclear plants to realize the full economic advantage of low cost nuclear power;

·	nuclear generation has gained public acceptance;

·	nuclear generation has demonstrated that it is a safe, reliable form of electricity generation a worldwide;

·	the federal government supports nuclear deployment through regulatory changes and tax benefits;

·	there are a limited number of sites that meet licensing and economic criteria for a nuclear plant;

·	licensing criteria involves low population density, low impact seismic potential activity and low environmental impact; and

·	economic/infrastructure: water availability, and ability to serve major markets through existing transmission, with low construction costs, etc.

The Site

After a three-year search, the Company has, through Idaho Energy, located a primary site (the “Site”) in Payette, Idaho that will cost approximately $25.0 million, including the acquisition of water rights. The Company believes this location is well suited for the licensing, construction and development of a nuclear power reactor. The Company, through Idaho Energy, has entered into and executed an agreement to complete the purchase of the Site. The agreement is renewable every 12 months by the parties until the land receives local approval for a nuclear plant, at which time the Company will ultimately purchase the location, subject to available financial resources. In the event that an approval is not received, Idaho Energy is not obligated to purchase the land. The features of the Site include:

·	about 5,000 acres near Payette, Idaho near the Payette River;

·	located near, and has ample rights to, a source of water;

·	a rural community that is very receptive to the development of a nuclear power plant;

·	ability to be connected to high voltage transmission lines and the western power grid;

·	NRC licensable according to the preliminary findings of nuclear siting experts, and a likely final favorable report for the land acquisition closing; and

·	spacious enough to accommodate multiple reactors.

The Site for this Project has passed preliminary evaluations by ENERCON, an engineering firm hired by AEHI that grants pre-approval of nuclear plant sites and assists with filing the NRC application. During the fourth quarter of 2009, our Idaho Energy Complex subsidiary entered the local land use approval process for the Project, and received initial approval from the Payette County Planning and Zoning Commission in November 2009. During 2010 we received the approval for our comprehensive plan from the Payette County Commissioners, and approval for the required rezoning of the proposed site from the Payette County Planning and Zoning Commission. We received final rezoning approval by the Payette County Commissioners June 2011. We expect to begin the approval process of the Nuclear Regulatory Commission (“NRC”) in 2012 and it may last as long as three to five years.

The Site Development Plan

Converting approximately 5,000 acres of Idaho farmland into a licensed nuclear reactor site is a major undertaking. Idaho Energy has commenced the preparatory stages of the Nuclear Regulatory Commission (NRC) process, which entails local approval, land and water contacts, and preliminary land evaluations, among other things, prior to applying for a combined operating and construction license (COL) for a reactor at the Site.

Nuclear Plant Construction Project - Phase 2

The Company intends to use a nuclear reactor design that is a Generation 3 Korean APR 1400 dual unit 2800 MW Light Water Reactor. It will use a hybrid cooling system that requires reduced amounts of water for cooling. Management believes that the Generation 3 plant design will be safe, reliable and economical to build and operate. It is estimated to produce power for $.02 to $.05 cents per kilowatt-hour, and will be among the first new commercial versions in the Western United States.

Land Purchase Agreement

There is an agreement between the Company and the current site owner for the purchase of the land (the “Land Purchase Agreement”) and an agreement for the water rights and additional land for backup site. Once completed, the agreement will transfer title to Idaho Energy upon constructive receipt of an approximately $5.0 million cash payment for the land plus $20.0 million for additional land with water rights. A 4% deposit was previously paid to hold the land for up to twelve months, which was subsequently extended for an additional twelve months to July 2012. The Company anticipates financing the Site acquisition with proceeds from one or more equity or debt offerings. The Land Purchase Agreement is subject to satisfactory completion of the final site analysis by ENERCON and the local approval for the nuclear plant construction will not be completed until the land has been locally approved for nuclear plant construction.

Construction and Operating License Application (“COLA”) and Water Rights

Management intends to obtain a rezone from Payette County and the COLA from the Nuclear Regulatory Commission for the Site by using either the services of ENERCON or the reactor supplier. ENERCON has already been conducting NRC pre-COLA application activities at the Site, including the preliminary site study. A $2.0 million payment will start the COLA. Furthermore, the Company has agreements $20.0 million for additional land with water rights.

Competition

Competition is intense in the energy market, with the two major sources of power generation being nuclear and fossil fuel. While nuclear power has high initial capital costs, it has the lowest production cost and highest capacity factor of the major sources of electricity, with a production cost of $0.0172 per kilowatt hour (kWh). According to national data from 2008, without carbon tax and emission reduction, coal has a production cost of $0.0275/kWh, natural gas of $0.081 cents/kWh, and petroleum of $0.098 cents/kWh. However, petroleum and coal prices have increased recently due to the rising prices of fossil fuel and are subject to market price swings. Natural gas is currently dropping due to new US sources.

The following table, recently developed by the NEI, compares total production costs, operations and maintenance costs, and fuel costs for generating electricity among four energy sources: coal, natural gas nuclear and petroleum. Note that as energy prices have risen, nuclear energy has become increasingly cost effective in relation to the other sources.

U.S. Electricity Production Costs and Components

1995 - 2009, in 2009 cents per kWh

	Total Production Costs				Operations & Maintenance Costs				Fuel Costs
Year	Coal	Gas	Nuclear	Petroleum	Coal	Gas	Nuclear	Petroleum	Coal	Gas	Nuclear	Petroleum
1995	2.56	3.73	2.69	5.83	0.61	0.71	1.89	1.64	1.96	3.02	0.80	4.20
1996	2.41	4.56	2.52	5.93	0.54	0.70	1.80	1.36	1.88	3.86	0.72	4.57
1997	2.33	4.62	2.64	5.33	0.52	0.67	1.93	1.16	1.81	3.95	0.71	4.17
1998	2.28	4.04	2.45	3.75	0.55	0.61	1.75	0.72	1.73	3.44	0.70	3.03
1999	2.20	4.37	2.21	4.50	0.52	0.51	1.57	1.02	1.67	3.86	0.64	3.47
2000	2.15	7.24	2.16	6.48	0.51	0.57	1.56	0.80	1.63	6.67	0.60	5.69
2001	2.20	7.30	2.05	5.99	0.54	0.64	1.48	0.82	1.66	6.66	0.56	5.17
2002	2.18	4.63	2.01	5.71	0.55	0.62	1.49	0.93	1.63	4.01	0.53	4.78
2003	2.15	6.37	1.98	6.86	0.55	0.66	1.44	1.09	1.60	5.72	0.53	5.77
2004	2.23	6.40	1.93	6.52	0.57	0.55	1.41	0.98	1.66	5.85	0.53	5.54
2005	2.42	7.99	1.87	8.94	0.57	0.53	1.38	0.97	1.85	7.47	0.49	7.97
2006	2.52	6.91	1.90	10.31	0.59	0.54	1.42	1.38	1.93	6.37	0.49	8.93
2007	2.57	6.68	1.89	10.78	0.60	0.52	1.39	1.45	1.96	6.16	0.50	9.33
2008	2.80	7.80	1.96	17.63	0.60	0.53	1.46	1.94	2.20	7.27	0.51	15.69
2009	2.97	5.00	2.03	12.37	0.67	0.56	1.46	2.55	2.30	4.44	0.57	9.82

Production Costs = Operations and Maintenance Costs + Fuel Costs. Production costs do not include indirect costs and are based on

FERC Form 1 filings submitted by regulated utilities. Production costs are modeled for utilities that are not regulated.

Source : Ventyx Velocity Suite from Nuclear Energy Institute’s website – Updated May 2010

Secondary energy sources in the United States include hydro (water), wind (which only produces 1% and has low reliability), and solar power, with the following production costs:

•

Hydro: $0.0175/kWh

•

Wind: $0.145/kWh

•

Solar: $0.23/kWh

These secondary energy suppliers are minor in scope and are significantly more limited in their operational efficiency, averaging approximately at 25% capacity. While wind and solar are expanding, they are not suitable base-load-plants that requires higher level of reliability because they do not stay connected to the grids. Coal and hydro have limited expansion ability due to new environmental concerns. Natural gas produces 60% of the carbon dioxide as the same size coal plant and the current costs are over 10 cents kWh. Nuclear energy has been endorsed by the United Nations’ study on global warming and the G-8 leadership.

With the continually rising demand for cost-effective energy sources in the United States, the Company anticipates minimal difficulties from its competition as it works toward the goal of constructing a new nuclear plant. The Federal incentives mentioned above are intended to reduce the inherently greater capital costs of nuclear power.

In addition, Energy Neutral has no competition for its initial focus area of Boise, Idaho. There are few companies providing services to reduce energy demand for homes and offices using renewable tools and technology in the United States.

Financings and Costs

The Company intends to develop or acquire businesses to help address domestic energy needs while trying to improve air quality and mitigate global warming. The Company intends to undertake equity or debt offerings in the form of public and private placements, or other financing vehicles, to hopefully raise sufficient funds to capitalize its four individual companies. The goal is to have each subsidiary of the Company further develop its own business strategies and self-sustaining operations and, in turn, upstream profits to the Company in exchange for capital and energy leadership expertise.

The Company estimates the cost of operation for its four corporate subsidiaries will be approximately $3,000,000 per year excluding phase 1 of the Project. Green World Water is presently working to market desalinization reactors, made in China, to Africa and the Middle East.

The Company hopes to raise $150 million through one or more private placements of equity and/or debt for the initial development of the Idaho energy complex. The funds will be used to purchase land that is under contract and water rights, and to complete the NRC approval process. At the time of this Annual Report, $1.0 million has been raised through the sale of a one percent (1%) equity position in our subsidiary, Reactor Land Development. Management believes that local plant site approval, if obtained, will allow the Company to raise sufficient additional funds.

As discussed in greater detail above, in March 2012, we entered into two related agreements with unrelated third parties pursuant to which we will be entitled to receive up to 45,900,000 Euros ($60,918,476) US dollars) in six installment payments over approximately the next 200 days.

Government Regulation

The Company is subject to risks associated with governmental regulations and legal uncertainties. The Company is directly or indirectly regulated by several authorities, including the Nuclear Regulatory Commission, Environmental Protection Agency, Idaho Department of Fish and Game, Idaho Department of Environmental Quality, Idaho Department of Water Resources and, as a public company, the Securities and Exchange Commission.

The Atomic Energy Act of 1954, as amended, is the primary United States law on both the civilian and the military use of nuclear materials. On the civilian side, it provides for both the development and regulation of the uses of nuclear materials and facilities in the United States based on the policy that “the development, use, and control of atomic energy shall be directed so as to promote world peace, improve the general welfare, increase the standard of living, and strengthen free competition in private enterprise.” The Atomic Energy Act requires civilian uses of nuclear materials and facilities to be licensed, and empowers the Nuclear Regulatory Commission (“NRC”) to establish by rule or order, and to enforce, such standards to govern these uses as “the Commission may deem necessary or desirable in order to protect health and safety and minimize danger to life or property.” Commission action under the Atomic Energy Act must conform to the Atomic Energy Act’s procedural requirements, which include an opportunity for hearings and Federal judicial review in many instances.

The Environmental Protection Agency (“EPA”) was formed to protect human health and safeguard the natural environment, such as air, water and land, upon which life depends. The EPA’s purpose is to ensure that:

·	all Americans are protected from significant risks to human health and the environment in which they live, learn and work;

·	national efforts to reduce environmental risks are based on the best available scientific information;

·	federal laws protecting human health and the environment are enforced fairly and effectively;

·	environmental protection is an integral consideration in U.S. policies concerning natural resources, human health, economic growth, energy, transportation, agriculture, industry, and international trade, and that these factors are similarly considered in establishing environmental policy;

·	all parts of society, such as communities, individuals, businesses, and state, local and tribal governments, have access to accurate information sufficient to effectively participate in managing human health and environmental risks;

·	environmental protection contributes to making our communities and ecosystems diverse, sustainable and economically productive; and

·	the United States plays a leadership role in working with other nations to protect the global environment.

The Idaho Department of Fish and Game states that “All wildlife, including all wild animals, wild birds, and fish, within the state of Idaho, is hereby declared to be the property of the state of Idaho. It shall be preserved, protected, perpetuated, and managed. It shall be only captured or taken at such times or places, under such conditions, or by such means, or in such manner, as will preserve, protect, and perpetuate such wildlife, and provide for the citizens of this state and, as by law permitted to others, continued supplies of such wildlife for hunting, fishing and trapping.”

The Idaho Department of Environmental Quality (“DEQ”) is a state department created by the Idaho Environmental Protection and Health Act to ensure clean air, water and land in the state and protect Idaho citizens from the adverse health impacts of pollution. As a regulatory agency, DEQ enforces various State environmental regulations and administers a number of Federal environmental protection laws including the Clean Air Act, the Clean Water Act, and the Resource Conservation and Recovery Act. DEQ manages a broad range of activities including:

·	assessment of environmental problems;

·	oversight of facilities that generate air, water, and hazardous waste pollution;

·	monitoring of air and water quality;

·	cleanup of contaminated sites; and

·	education, outreach, and technical assistance to businesses, local government agencies, and interested citizens.

DEQ is committed to working in partnership with local communities, businesses, and citizens to identify and implement cost-effective environmental solutions.

The Idaho Department of Water Resources serves the people of Idaho and protects their welfare by making sure that water is conserved and available to sustain Idaho’s economy, ecosystem and the resulting quality of life. The Department provides a variety of services for the public, such as water rights research, historical record reproduction of water rights, drillers’ reports, and dam safety inspections.

Employees

As of April 3, 2012 the Company and its subsidiaries had 6 full-time employees and 1 FTE contractor. In addition, six directors provide certain services dedicated to current corporate and business development activities. The Company’s future success will depend in part on our ability to attract, retain and motivate highly qualified technical and management personnel for whom competition is intense. The Company’s employees are not represented by any collective bargaining unit and the Company believes that its relations with employees and contractors are good.

Item 1A. Risk Factors

FORWARD-LOOKING STATEMENTS

This document includes forward-looking statements, including, without limitation, statements relating to the Company’s plans, strategies, objectives, expectations, intentions and adequacy of resources. These forward-looking statements involve known and unknown risks, uncertainties, and other factors that may cause the Company’s actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by the forward-looking statements. These factors include, among others, the following: ability of the Company to implement its business strategy; ability to obtain additional financing; the Company’s limited operating history; unknown liabilities associated with future acquisitions; ability to manage growth; significant competition; ability to attract and retain talented employees; uncertainty with respect to obtaining required permits, approvals and licenses; future government regulations; and other factors described in this annual report or in other filings with the Securities and Exchange Commission. Except as required by Federal securities laws, the Company is under no obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.

General Business Risk Factors

The Company is a development stage business with insignificant revenues to date so, the company may never be profitable.

The Company was organized as a corporation under the laws of the State of Nevada on July 31, 2001 and commenced its operations in August 2005. The Company is considered to be in an early development stage with all of the unforeseen costs, expenses, problems, risks and difficulties to which such ventures are subject. Prior to fiscal year 2011, we had never generated any revenue so there is no assurance that the Company will ever operate profitably. In 2011, the company reported $923,660 in revenues from the sales of the five Energy Neutral homes. Further, it has only a limited history upon which an evaluation of its prospects and future performance can be made. The Company’s proposed operations are subject to all business risks associated with new enterprises. The likelihood of the Company’s success must be considered in light of the problems, expenses, difficulties, complications and delays frequently encountered in connection with the expansion of a business in a competitive industry, including hiring and retaining skilled employees or contractors; responding to problems with licenses, permits, and operations; competing with established operators; and managing unanticipated location issues or design/engineering problems. Since the commencement of operations through December 31, 2011, the Company has not recognized any significant revenues from its operational activities and suffered losses. It is likely that the Company will continue to sustain more losses in the future. There can be no assurance that the Company will ever operate profitably. The Report of Independent Registered Public Accounting Firm to our December 31, 2011 consolidated financial statements includes an explanatory paragraph stating that the losses and negative cash flows from operations since inception and our limited working capital and cash flow equivalent balance as of December 31, 2011 raise substantial doubt about our ability to continue as a going concern. The consolidated financial statements do not include any adjustments that might result from the outcome of this uncertianity.

The Company may not be able to meet its financial needs and may encounter unexpected additional costs, which would prevent it from implementing its expansion strategy as planned or at all.

The Company plans to grow its business by investing in new plants and pursuing other business opportunities, including the planned construction of our Idaho nuclear plant which will initially require approximately $150 million just to complete the land and water rights acquisition and the NRC approval process. Additional financing may be necessary to implement these expansion strategies, which may not be accessible or available on acceptable terms. Any expansion may be financed with additional indebtedness or by issuing additional equity securities, which would further dilute shareholders’ interests. In addition, as described below under the risk factor “The Company may be adversely affected by environmental, health and safety laws, regulations and liabilities,” Federal and state governmental requirements may substantially increase our costs, which could have a material adverse effect on our results of operations and financial position. Any expansion plans may also result in other unanticipated adverse consequences, such as the diversion of management’s attention from existing operations.

Construction costs associated with expansion may also increase to levels that would make a new site too expensive to complete or unprofitable to operate. Contractors, engineering firms, construction firms and equipment suppliers also receive requests and orders from other companies and, therefore, it may become hard or impossible to secure their services or products on a timely basis or on acceptable financial terms. We may suffer significant delays or cost overruns as a result of a variety of factors, such as shortages of workers or materials, transportation constraints, adverse weather, unforeseen difficulties or labor issues, any of which could prevent commencement of operations as expected at any new facilities.

We have been named as a party to a purported class action lawsuit and an action initiated by the U.S. Securities and Exchange Commission, and we may be named in additional litigation, all of which could require significant management time and attention and result in significant legal expenses. An unfavorable outcome in one or more of these lawsuits could have a material adverse effect on our business, financial condition, results of operations and cash flows.

As described in detail in Item 3, an action initiated by the U.S. Securities and Exchange Commission (“SEC”) is pending in the U.S. District Court for the District of Idaho, alleging, among other things, that our company, and certain of our officers and directors, violated the federal securities laws by issuing materially false and misleading statements, artificially inflating the company’s stock price, and subsequently liquidating the stock through secret sales (the “SEC Action”). The SEC Action was brought shortly after the SEC froze trading in the company’s shares. A purported class action is also pending in the U.S. District Court for the District of Idaho with allegations substantially similar to the SEC Action. Regardless of the merits of these actions, the expense of defending such litigation may have a substantial impact if our insurance carriers fail to cover the cost of the litigation, and the time required to defend the actions could divert management’s attention from the day-to-day operations of our business, which could adversely affect our business, results of operations and cash flows. An unfavorable outcome in such litigation could have a material adverse effect on our business, results of operations and cash flows.

The Company’s success depends on its ability to attract and retain key management personnel, the lack of which would impede the Company’s success.

The Company’s success depends in large part on its ability to attract and retain highly qualified management, and in particular upon its CEO, Donald Gillispie. Due to the specialized nature of the Company’s business, it may be difficult to locate and hire qualified personnel. The loss of services of one or more of the Company’s executive officers or other key personnel, or its failure to attract and retain other executive officers or key personnel, could have a material adverse effect on the Company’s business, operating results and financial condition. Although we have been successful in planning for and retaining highly capable and qualified successor management in the past, there can be no assurance that we will be able to do so in the future.

The Company depends upon outside contractors and advisors to supplement its business, the lack of which would affect its ability to develop and conducts its business.

The Company’s officers and directors may not have all of the expertise required to develop and operate the Company’s business. Therefore, the Company may be required to retain outside contractors, accountants, technical experts, appraisers, attorneys, or other consultants or advisors. The Company may not be able to engage qualified third parties at all or at reasonable costs. In addition, the Company may need to employ third parties on an “as needed” basis. The Company may not be able to engage those hired on an “as needed” basis on short notice, which would delay the completion of a project in a timely manner and incur additional costs.

The Company may not be able to obtain the required financing at all or on terms favorable to the Company, resulting in the Company’s inability to execute its business plan.

In addition to funds obtained through private placements, the Company may need to obtain loans to finance its activities. As a development stage company, the Company may not be able to obtain loans at all or on terms adverse to the Company, such as exorbitantly high interest rates. The ability of the Company to obtain future financing, and the terms of such financing have not yet been established. The Company does not currently have any loan commitments. The Company may not be able to develop and operate its business without outside financing.

Market data may not always be reliable, which would affect the Company’s projections and may lead to the Company’s inability to generate revenues.

The Company has based the market data and certain other information in this Form 10-K on information supplied by governmental agencies, public announcements, filings related to other developments and similar projects in the same area, and other third party sources. The Company has relied on such sources in making its assumptions and developing its business plan. The Company has not independently verified any market information, announcements or filings, which may not be accurate in all material respects. Accordingly, investors should keep in mind that the market data and conditions may change at any time for a variety of reasons, which would affect the Company’s projections regarding revenues.

The Company may not be able to attract investors in this current economic environment, the absence of which the Company will not be able to develop and expand its business.

The financial success of the Company is sensitive to the current adverse changes in general economic conditions in the United States, such as recession, inflation, unemployment, and high interest rates. The Company has no control over these conditions. Furthermore, such conditions may worsen, thereby decreasing the demand in the marketplace for the development of nuclear sites.

Specific Risk Factors Related to the Company and Nuclear Plants

Development of nuclear sites is subject to examination in the NRC permitting process that may result in denial, revocation or modification of permits or approvals.

The Company is subject to the general risks facing the nuclear industry. Because the nuclear energy industry is closely regulated, the Company will be required to obtain and comply with Federal, state and local government permits and approvals, particularly those from the Nuclear Regulatory Commission (“NRC”). Any of these permits or approvals may be denied, revoked or modified under various circumstances. Failure to obtain or comply with the conditions of permits or approvals will subject nuclear plants to penalties and other sanctions. Renewal could be denied or jeopardized by various factors, including the following:

·	natural disasters, such as earthquakes (such as the recent earthquake in Japan that has significantly impaired the stability of some of its nuclear reactors), floods, volcano eruptions, and hurricanes;

·	wars, insurrection, revolutions or acts of terrorism;

·	inability to obtain or comply with state and local permits;

·	inadequate multiple point access to the site;

·	inadequate financial assurances to provide for end-of-life decommissioning and decontamination of the site;

·	inability to obtain adequate connection to the transmission grid, which has economic as well as safety implications;

·	inability to assure adequate water supplies for steam and cooling because the Company’s water rights could be lost because of government actions, extreme drought conditions, or competing economic demands for the water supply;

·	environmental objections; and

·	substantial changes in government regulations due to changes in national government (i.e., political risks).

Nuclear property ownership and development is subject to substantial additional risks as compared to conventional development.

For nuclear projects, the risk of conventional real property development is heightened because the systems for processing approvals for nuclear development project can be slow, bureaucratic, and not as well-developed or scheduled as those for more conventional projects. There can be substantial political influence asserted against nuclear development project approval without the knowledge of who is behind the opposition. There is no effective accountability to the process. Nuclear projects are also subject to compliance with international safety and nuclear non-proliferation regimes.

Unforeseen technical or environmental factors could preclude use of a certain site for power generation, which would require the identification of another site, if at all available.

There is a risk that in the licensing process, further investigation and analysis could uncover facts that would preclude development of a site as planned, such as unknown and unfavorable geological conditions or endangered species habitat on such site. This would require more human and financial investment in locating another site, which may or may not be available.

Unforeseen changes in state or local law or government policy, such as a ban on nuclear or power plant construction, will prohibit the Company from meeting its objective of developing a site that will be suitable for the construction and operation of a reactor.

Development investments always carry regulatory risk. Local governments can adopt capricious, arbitrary and expensive rules for which there is no effective appeal or remedy, which can make a development impractical or unprofitable. The Project will proceed only if state and local governments issue necessary permits. There can be political instability that causes projects in design or development to become unfeasible, or that make the local unattractive to would be purchasers. For example, local governments could place restrictive conditions on the Site in permits; impose substantial new taxes or development fees; or introduce a moratorium on buildings or developments.

Special interest interveners in licensing proceedings may lead to costly delays.

In the 1970’s and 1980’s, special interest groups opposed to nuclear plant construction intervened in federal and state licensing proceedings. They were sometimes joined by community groups and state and local governmental agencies. While these opponents were usually unsuccessful on the merits, the interventions produced delays and regulatory changes that adversely affected the economics of capital-intensive nuclear construction and led to the cancellation of several projects.

The Company may be unable to raise equity capital sufficient to take the Project through the licensing process, which may result in investors losing their full investment amount.

Management estimates that the cost of obtaining licenses and permits needed for the Project will total approximately $50.0 million. Delays and unforeseen technical issues could raise the cost of that process, and additional capital may be required to complete it. The Company may not be able to raise funds for those additional costs. If the Company is unable to raise enough funds to get it through the licensing process, the investors may lose the full amount of their investment. Even if the additional costs are funded all needed permits are eventually issued, any delay will reduce investor returns.

Competition to obtain technical and professional help may lead to a shortage of talent.

The NRC licensing process is highly technical, and a number of reactors will be applying for licenses in the next three years. Experienced nuclear talent has become relatively scarce in the United States and there will be competition among companies and utilities to get the talent necessary to get reactors licensed and built. Also, the domestic nuclear infrastructure has declined in the last two decades, which has reduced the talent pool and created certain long-lead components that may be expensive or difficult to obtain on schedule.

A nuclear incident anywhere in the world, such as the recent earthquake and tsunami in Japan, could revive nuclear plant opponents, could affect the federal regulatory approval process, and could make it more difficult to raise the capital necessary fund construction of the Project.

While there is a global renaissance underway for nuclear energy, its current popular support could evaporate quickly. While it has been 30 years since the Three Mile Island accident and 20 years since Chernobyl, the recent earthquake and tsunami in Japan which led to significant damage to three reactors at the Fukushima Dai-ichi nuclear plant, including the possible damage to fuel rods inside the three reactors. This disaster in Japan, could reawaken old fears regarding nuclear energy production and raise public opposition to the planned future construction of nuclear plants, including the Project. Increased public opposition could lead to political opposition and failure of regulatory agencies to grant necessary permits and licenses, and could also make it much more difficult for us to raise the money we require to fund the Project’s approval and construction.

The federal government could fail to fulfill its obligation to manage spent fuel at Yucca Mountain or elsewhere.

Virtually all nuclear plants currently store spent fuel at the reactor site. By law, all spent fuel in the US is the property of the United States government. After a number of years, it is expected that the spent fuel will be transported by the government to the Yucca Mountain long-term geological depository, or to a reprocessing facility. If the United States government fails to fulfill its obligations, uncertainty about spent fuel management could delay start up of a plant, premature closure, or alternative plans for on-site storage.

Competitive sites or generation sources could offer electric utilities lower prices, or regulatory policy could force utilities to buy power from favored alternative energy sources, regardless of their economics.

Management believes that the chosen reactor design will be very competitive in a free market where its competitors are fossil- or renewable-fueled State regulators may force utilities to buy from renewable or other favored technologies, locations, or sources, regardless of cost, and to the detriment of the Project.

There are alternative sites in the region that could be developed for nuclear reactors. However, with demand for electric power growing in the west, the competition is to secure the scarce good sites, and the Company has secured a good Site. Management believes that the Company’s proposed property is geologically and demographically well located. However, there is the possibility that other sites will be developed for nuclear or coal plants. If, there should be growth of competitive nuclear plants in the West, margins will drop for the Project. However, all the new plants that are planned will be needed to provide reliable power for the western US in the decades to come. Likewise, these competitors could be better capitalized than the Company, which could give them a significant advantage with respect to bringing low cost low emission plants on line sooner.

Competing development projects could saturate the market and thereby diminish the resale value of the Company’s land. As of March 28, 2012, the Company does not expect significant competition from other generation site development projects. In the future, however, the Company will have no control over other competitive projects, if such develop.

Weather interruptions could impact the development of nuclear plants.

Activities of a nuclear plant are subject to periodic interruptions due to weather conditions. Weather-imposed restrictions during certain times of the year on roads accessing properties could adversely affect the ability to develop nuclear sites or increase the costs of construction because of delays.

There are many factors beyond the control of the Company with respect to the building.

Projects for the acquisition and development of real estate are subject to many factors which are outside the Company’s control. These factors include: general economic conditions; proximities to utilities and transportation; shortages of labor and materials and skilled craftsmen; price of materials and competitive products; and the regulation by federal and state governmental authorities.

Delays attributable to queuing at the NRC with other applications ahead of Idaho Energy in the licensing process.

The NRC has had virtually no new reactor licensing activity in the last 25 years. In 2010, President Obama announced that his administration approved $8.3 billion loan guarantee to build the first domestic nuclear power plant at Plant Voltge in Waynseboro, Georgia. Now there are proposals for as many as 30 to 35 new reactors. If these are all filed in the next 3 to 5 years, the NRC may be overwhelmed. Meritorious applicants may have to wait their turn, with potential adverse impacts on schedule and Project economics.

Inability to raise equity capital sufficient to take the project through the licensing process.

Management estimates that cost of obtaining licenses and permits needed for the Project will total $50.0 million. Delays and unforeseen technical issues could raise the cost of that process, and additional capital may be required to complete it. The additional investment and the delay would reduce investor returns even if all needed permits are eventually issued.

Competitive sites or generation sources could offer electric utilities at lower prices, or regulatory policy could force utilities to buy power from favored alternative energy sources, regardless of their economics.

Competing development projects could saturate the market and thereby diminish the resale value of the Company’s land. As far as is known as of the date of this Offering, the Company does not expect significant competition from other generation site development projects. In the future, however, the Company will have no control over other competitive projects, if such develop.

Delays may keep the project from qualifying for incentives under the energy policy act of 2005.

Under the Energy Policy Act of 2005, Congress has provided production tax credits, loan guarantees, and regulatory risk insurance for the first few new nuclear plants. The Project has a chance to qualify for these, but if the Project is delayed, or the schedule for other planned nuclear plants accelerates, the opportunity to get the incentives may be lost.

Risk Factors Relating to Company

Investing in the Company is a highly speculative investment.

Due to the highly speculative nature of the Company’s business, investors should not invest unless they can financially bear the loss of their entire investment. Investment should, therefore, be limited to that portion of discretionary funds not needed for normal living purposes or for reserves for disability and retirement.

The Company is subject to the reporting requirements of the federal securities laws.

The Company is subject to the reporting requirements under the Securities Exchange Act of 1934. As a result, shareholders will have ready access to the information required to be reported by publicly held companies under the Securities Exchange Act and the regulations hereunder. The Company intends to provide its shareholders with quarterly reports containing financial information prepared in accordance with generally accepted accounting principles (unaudited).

This may be a long term investment.

An investment in our common stock may be long term and illiquid. A limited market exists for the shares or our common stock. Accordingly, purchasers of shares must be willing and able to bear the economic risk of their investment for an indefinite period of time. It is likely that investors will not be able to liquidate their investment in the event of an emergency.

The Company has limited liquidity, cash flow and capital resources.

The Company had minimum liquid assets as of December 31, 2011 relative to its potential capital requirements, and will be reliant upon stock and/or debt offerings to fund any kind of nuclear operations. The only capital resources of the Company are its common stock. The monies raised by any private offering may not be sufficient for the continued proposed operations of the Company. There is no assurance that additional monies or financing will be available in the future or, if available, will be at terms favorable to the Company. The Company may borrow money to finance its future operations, although it does not currently contemplate doing so. Any such borrowing will increase the risk of loss to the investor in the event that the Company is unsuccessful in repaying such loans. The Company has achieved no cash flows to date, and management foresees limited cash flows until any property it permits and acquires is sold, leased, or the asset is merged into an entity that will finance, own and operate reactors at the Site.

The Company is a holding company and there are limitations on its ability to receive distributions from its subsidiaries.

We conduct all of our operations through subsidiaries and are dependent upon dividends or other intercompany transfers of funds from our subsidiaries to meet our obligations. Moreover, some of our subsidiaries are currently, or are expected in the future to be, limited in their ability to pay dividends or make distributions to us by the terms of their financing agreements.

Risk Factors Related to Proposed International Operations

The proposed international operations of Green World Water™ will subject us to material risks that our domestic business does not expose us to.

The proposed international operations of Green World Water™ will subject us to a number of risks, including the following:

•

maintaining compliance with complex and unfamiliar foreign laws and regulations;

•

maintaining compliance with U.S. laws applicable to the operation of foreign subsidiaries, most particularly the Foreign Corrupt Practices Act which, in some countries in which we do or may seek to do business, may prohibit activities by our foreign subsidiaries that are accepted and legal practices in those countries;

•

difficulties and costs of staffing and managing foreign operations;

•

difficulties in enforcing agreements and collecting receivables through foreign legal systems and other relevant legal issues;

•

including fewer legal protections for intellectual property;

•

fluctuations in foreign economies and in the value of foreign currencies and interest rates; and

•

general economic and political conditions in the countries in which we operate.

Problems or negative developments in any of these areas could adversely impact Green World Water’s™ business, financial condition or results of operations. Furthermore, the integration of our non-U.S. businesses may require additional licenses or approvals from the United States government or other non-U.S. jurisdictions, which could result in delays or constraints on our integration plans.

Fluctuations in currency exchange rates could materially and adversely impact Green World Water’s™ financial results.

Because the Company’s financial statements are presented in U.S. dollars, the Company will be required to translate revenues, income and expenses, as well as assets and liabilities, into U.S. dollars at exchange rates in effect during or at the end of each reporting period if we are able to successfully carry out Green World Water’s™ plans for international operations. Therefore, increases or decreases in the value of the U.S. dollar against these other currencies will affect our net operating revenues, our operating income and the value of balance sheet items denominated in foreign currencies, even if those values have not changed in the original currencies. In the future, if Green World Water™ is successful in carrying out its international operational plans, the Company may implement additional currency hedges intended to reduce our exposure to changes in foreign currency exchange rates; however, hedging strategies may not be successful. As a result, fluctuations in foreign currency, exchange rates, could materially and adversely affect Green World Water’s™ business, financial condition, results of operations and cash flows.

Risk Factors Related to Common Stock

There are limited trading markets for the Company’s common stock, thereby limiting a shareholder’s opportunity to sell such common stock.

Currently, only a limited trading market exists for the Company’s common stock. Our common stock is quoted on the Pink Sheets under the symbol “AEHI.PK.” The Pink Sheets is a limited market and subject to substantial restrictions and limitations in comparison to the Nasdaq system. Any broker/dealer that makes a market in the Company’s stock or other person that buys or sells the Company stock could have a significant influence over its price at any given time. The Company cannot assure its shareholders that a greater market for the Company’s common stock will be sustained. There is no assurance that the Company’s common stock will have any greater liquidity than shares that do not trade on a public market. A shareholder may be required to retain their shares for an indefinite period of time, and may not be able to liquidate their shares in the event of an emergency or for any other reasons.

The regulation of penny stocks by the SEC and FINRA may discourage the tradability of the Company’s securities.

The Company is a “penny stock” company. The Company securities currently trade on the Pink Sheets and will be subject to a Securities and Exchange Commission rule that imposes special sales practice requirements upon broker-dealers who sell such securities to persons other than established customers or accredited investors. For purposes of the rule, the phrase “accredited investors” means, in general terms, institutions with assets in excess of $5,000,000, or individuals having a net worth in excess of $1,000,000 or having an annual income that exceeds $200,000 (or that, when combined with a spouse’s income, exceeds $300,000). For transactions covered by the rule, the broker-dealer must make a special suitability determination for the purchaser and receive the purchaser’s written agreement to the transaction prior to the sale. Effectively, this discourages broker-dealers from executing trades in penny stocks. Consequently, the rule will affect the ability of purchasers in this offering to sell their securities in any market that might develop therefore because it imposes additional regulatory burdens on penny stock transactions. In addition, the Securities and Exchange Commission has adopted a number of rules to regulate “penny stocks”. Such rules include Rules 3a51-1, 15g-1, 15g-2, 15g-3, 15g-4, 15g-5, 15g-6, 15g-7, and 15g-9 under the Securities and Exchange Act of 1934, as amended. Because the Company’s securities constitute “penny stocks” within the meaning of the rules, the rules would apply to the Company and to the Company securities. The rules will further affect the ability of owners of shares to sell the Company securities in any market that might develop for them because it imposes additional regulatory burdens on penny stock transactions. Shareholders should be aware that, according to Securities and Exchange Commission, the market for penny stocks has suffered in recent years from patterns of fraud and abuse. Such patterns include (i) control of the market for the security by one or a few broker-dealers that are often related to the promoter or issuer; (ii) manipulation of prices through prearranged matching of purchases and sales and false and misleading press releases; (iii) “boiler room” practices involving high-pressure sales tactics and unrealistic price projections by inexperienced sales persons; (iv) excessive and undisclosed bid-ask differentials and markups by selling broker-dealers; and (v) the wholesale dumping of the same securities by promoters and broker-dealers after prices have been manipulated to a desired consequent investor losses. The Company management is aware of the abuses that have occurred historically in the penny stock market. Although the Company does not expect to be in a position to dictate the behavior of the market or of broker-dealers who participate in the market, management will strive within the confines of practical limitations to prevent the described patterns from being established with respect to the Company securities.

The Company will pay no foreseeable dividends in the future.

The Company has not paid dividends on its common stock and does not anticipate paying such dividends in the foreseeable future.

Rule 144 sales in the future may have a depressive effect on the Company’s stock price.

All of the outstanding shares of common stock are held by the Company present officers, directors, and affiliate stockholders as “restricted securities” within the meaning of Rule 144 under the Securities Act of 1933, as amended. As restricted Shares, these shares may be resold only pursuant to an effective registration statement or under the requirements of Rule 144 or other applicable exemptions from registration under the Act and as required under applicable state securities laws. Rule 144 provides in essence that a person who has held restricted securities for six months may, under certain conditions, sell every three months, in brokerage transactions, a number of shares that does not exceed the greater of 1.0% of a company’s outstanding common stock or the average weekly trading volume during the four calendar weeks prior to the sale. There is no limit on the amount of restricted securities that may be sold by a non-affiliate after the owner has held the restricted securities for a period of two years. A sale under Rule 144 or under any other exemption from the Act, if available, or pursuant to subsequent registration of shares of common stock of present stockholders, may have a depressive effect upon the price of the common stock in any market that may develop.

The Company’s investors may suffer future dilution due to issuances of shares for various considerations in the future.

There may be substantial dilution to the Company any shareholders as a result of future decisions of the Board to issue shares without shareholder approval for cash, services, or acquisitions.

The Company’s stock will in all likelihood be thinly traded and as a result an investor may be unable to sell at or near ask prices or at all if the investor needs to liquidate shares.

The shares of the Company’s common stock is traded in the Pink Sheets, meaning that the number of persons interested in purchasing the Company common shares at or near ask prices at any given time may be relatively small or non-existent. This situation is attributable to a number of factors, including the fact that the Company is a small company which is relatively unknown to stock analysts, stock brokers, institutional investors and others in the investment community that generate or influence sales volume, and that even if the Company came to the attention of such persons, they tend to be risk-averse and would be reluctant to follow an unproven, early stage company such as the Company or purchase or recommend the purchase of any of the Company’s securities until such time as the Company becomes more seasoned and viable. As a consequence, there may be periods of several days or more when trading activity in the Company securities is minimal or non-existent, as compared to a seasoned issuer which has a large and steady volume of trading activity that will generally support continuous sales without an adverse effect on securities price. The Company cannot give you any assurance that a broader or more active public trading market for the Company common securities will develop or be sustained, or that any trading levels will be sustained. Due to these conditions, the Company can give investors no assurance that they will be able to sell their shares at or near ask prices or at all if the investor needs money or otherwise desires to liquidate the securities of the Company.

The Company’s common stock may be volatile, which substantially increases the risk that the investor may not be able to sell their securities at or above the price that the investor paid for the security.

Because of the limited trading market for the Company’s common stock and because of the possible price volatility, the investor may not be able to sell its shares of common stock when the investor desires to do so. The inability to sell the investors securities in a rapidly declining market may substantially increase the risk of loss because of such illiquidity and because the price for the Company shares may suffer greater declines because of the Company’s price volatility.

The price of the Company’s common stock that will prevail in the market may be higher or lower than the price the investor may pay. Certain factors, some of which are beyond the Company’s control, that may cause the Company’s share price to fluctuate significantly include, but are not limited to the following:

·	variations in the Company’s quarterly operating results;

·	loss of a key relationship or failure to complete significant transactions;

·	additions or departures of key personnel; and

·	fluctuations in stock market price and volume.

Additionally, in recent years the stock market in general, and the over-the-counter markets in particular, have experienced extreme price and volume fluctuations. In some cases, these fluctuations are unrelated or disproportionate to the operating performance of the underlying company. These market and industry factors may materially and adversely affect the Company stock price, regardless of its operating performance. In the past, class action litigation often has been brought against companies following periods of volatility in the market price of those companies common stock. If the Company becomes involved in this type of litigation in the future, it could result in substantial costs and diversion of management attention and resources, which could have a further negative effect on the investors’ investment in the Company stock.

Item 1B. Unresolved Staff Comments

Not applicable.

Item 2. Properties

The Company’s operations are principally located at 911 E. Winding Creek Dr., Suite 150, Eagle, Idaho 83616. The Company currently pays $2,000 as monthly rent for the use of this office which is renewable annually. Once the construction of the Idaho energy complex is completed, the plant will become the Company’s primary facility.

Item 3. Legal Proceedings

Class Action Litigation

On January 11, 2011, a class action lawsuit was filed in the U.S. District Court for the District of Idaho on behalf of purchasers of the common stock of the company between September 20, 2006 through December 14, 2010, against the company and certain of its officers and directors by Lance Teague. On March 7, 2011, plaintiff moved to appoint John O’Brien as Lead Plaintiff. The complaint alleged claims against the Company and certain of its senior officers and directors for violations of Section 10(b) of the Securities and Exchange Act of 1934 (the “Exchange Act”) and Rule 10b-5 thereunder and claims against certain of its senior officers and directors for violations of Section 20A and Section 20(a) of the Exchange Act. The complaint seeks compensatory damages for all damages sustained as a result of the defendants’ alleged actions, including reasonable costs and expenses, rescission, and other relief the Court deemed just and proper. The Company believes the lawsuit is without merit and intends to vigorously defend itself. No amounts have been recorded in the consolidated financial statements for this matter as the company believes it is too early in the proceedings to determine an outcome. Discovery in this case has not begun. The parties are meeting for a mediation session on April 2, 2012

Other Legal Proceedings

Currently, an action initiated by the U.S. Securities and Exchange Commission (“SEC”) is pending in the U.S. District Court for the District of Idaho, alleging, among other things, that our company, and certain of our officers and a director, violated the federal securities laws by making materially false and misleading statements, artificially inflating the company’s stock price, and subsequently liquidating the stock through secret sales (the “SEC Action”). The company’s accounts were frozen on December 18, 2010 following the filing of the civil complaint by the SEC in connection with the SEC Action; however, after oral argument and the submission of lengthy papers, the Court ordered that the freeze be lifted but also requested that the parties reach agreement to provide the SEC some form of relief in so doing. The parties reached an agreement that the Company shall report to the SEC on a monthly basis all if its expenses of $2,500 and above during the pendency of the litigation and further agreed not to violate any federal securities laws.

The Company is in the discovery phase and a trial is scheduled for October 2012.

The Company anticipates that it will from time to time become subject to claims and legal proceedings arising in the ordinary course of business. It is not feasible to predict the outcome of any such proceedings and the Company cannot assure that their ultimate disposition will not have a materially adverse effect on the Company business, financial condition, cash flows or results of operations.

Item 4. Mine Safety Disclosures

Not applicable.

PART II

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Market Information

There is a limited public trading market for the Company’s common stock. The Company’s trading symbol is AEHI.PK, as quoted by the Pink Sheets.

The following table sets forth the range of high and low bid quotations for our common stock as reported on the Pink Sheets. The quotations represent inter-dealer prices without retail markup, markdown or commission, and may not necessarily represent actual transactions.

QUARTER ENDED	HIGH	LOW
December 31, 2011	$0.08	$0.04
September 30, 2011	$0.11	$0.05
June 30, 2011	$0.18	$0.07
March 31, 2011	$0.32	$0.06
December 31, 2010	$0.87	$0.08
September 30, 2010	$0.90	$0.42
June 30, 2010	$0.80	$0.11
March 31, 2010	$0.19	$0.09

Holders

There were approximately 826 holders of record of the Company’s common stock as of April 3, 2012.

Dividend Policy

Holders of the Company’s common stock are entitled to receive such dividends as may be declared by the Company’s board of directors. The Company has not declared or paid any dividends on the Company common stock and it does not plan on declaring any dividends in the near future. The Company currently intends to use all available funds to finance the operation and expansion of its business.

Shares Eligible for Future Sale

The Company currently has 326,562,791 shares of common stock outstanding as of April 3, 2012. A current shareholder who is an “affiliate” of the Company, defined in Rule 144 as a person who directly, or indirectly through one or more intermediaries, controls, is controlled by, or is under common control with the Company will be required to comply with the resale limitations of Rule 144. Of these shares, a total of 265,575,291 shares have been held for six months or more and are eligible for resale under Rule 144. Sales by affiliates will be subject to the volume and other limitations of Rule 144, including certain restrictions regarding the manner of sale, notice requirements, and the availability of current public information about the Company. The volume limitations generally permit an affiliate to sell, within any three-month period, a number of shares that does not exceed the greater of 1% of the outstanding shares of common stock or the average weekly trading volume during the 4 calendar weeks preceding his sale. A person who ceases to be an affiliate at least three months before the sale of restricted securities beneficially owned for at least six months may sell the restricted securities under Rule 144 without regard to any of the Rule 144 limitations.

Recent Sales of Unregistered Securities

During April 2011, we issued an aggregate of 100,000 shares of our common stock to a consultant in exchange for services rendered. The shares of common stock were issued at a price of $.10 per share or aggregate gross proceeds of $10,000.

During May 2011, we issued an aggregate of 1,750,000 shares of our common stock to board directors and a consultant for services rendered. The shares of common stock were issued at a price of $.1031 per share or aggregate gross proceeds of $180,500.

During June 2011, the Company and a consultant entered into an agreement to rescind 1,000,000 shares of common stock previously awarded to them.

During September 2011, we issued an aggregate of 25,000 shares of our common stock to a consultant in exchange for services rendered. The shares of common stock were issued at a price of $.10 per share or aggregate gross proceeds of $2,500.

Exemption from Registration Claimed

All of the sales by the Company of its unregistered securities were made in reliance upon Section 4(2) of the Securities Act of 1933, as amended. The entity listed above that purchased the unregistered securities was an existing shareholder, known to the Company and its management, through pre-existing business relationships, as a long standing business associates. The entity was provided access to all material information, which it requested, and all information necessary to verify such information and was afforded access to the Company’s management in connection with the purchases. The purchaser of the unregistered securities acquired such securities for investment and not with a view toward distribution, acknowledging such intent to the Company. All certificates or agreements representing such securities that were issued contained restrictive legends, prohibiting further transfer of the certificates or agreements representing such securities, without such securities either being first registered or otherwise exempt from registration in any further resale or disposition.

Issuer Purchases of Equity Securities

The Company did not repurchase any shares of its common stock during the year ended December 31, 2011.

Item 6. Selected Financial Data

Not applicable.

Item 7. Management’s Discussion and Analysis of Financial condition and results of Operations

Overview

The Company is in the business of serving the electric power generation industry by acquiring and developing nuclear plant sites and obtaining licenses for their construction and operation through its operating subsidiaries. The Company’s management has experience in the nuclear industry, power generation, and facility development. The Company formed Idaho Energy Complex and Reactor Land as its subsidiaries to manage and finance its business plan to develop a proposed site in Idaho for a reactor. Reactor Land began operations in September 2007, with the purpose of acquiring land and water rights, permits and licenses, development rights and such other property and services necessary to develop an energy complex in Idaho including one or more nuclear reactors (referred to as the “Project”).

In October 2009, the Company’s Energy Neutral subsidiary began construction on a model home to demonstrate that a competitively-priced and energy cost efficient home can be constructed using renewables. Construction of the first model home was completed in 2009, with construction of five additional homes completed during 2010 and early 2011. As noted above, we closed on the sale of all five of these homes in 2011. These homes serve to introduce Energy Neutral’s unique energy producing and saving features to a range of potential users. The Company used these homes to market its Energy NeutralTM packages and a new energy neutral subdivision in Idaho (in which five of these homes were constructed). We hope to expand the Energy Neutral concept through licensing arrangements with third-parties in 2012.

In November 2007, we formed our wholly owned subsidiary, International Reactors, to assist developing countries with power generation, as well as the production of potable water. This line of business is now being conducted by our wholly-owned subsidiary, Green World Water, Inc., an Idaho LLC founded in 2010, and International Reactors is inactive. Green World Water seeks to construct commercial nuclear reactors on oceanfront sites, particularly in Africa and western-friendly Middle Eastern countries to co-generate clean energy and desalinate water. Green World Water believes that advanced nuclear technology can be used to address electrical energy needs while simultaneously producing fresh water from ocean intake. The Company has an agreement with China National Nuclear Corporation (CNNC) to produce desalinization reactors in China to market on a worldwide basis.

Plan of Operations

The Company estimates that the total cost of the first phase of the Project will be approximately $150 million. The initial $150 million is planned to be raised through the Reactor Land private placement, which shall result in the investors receiving in the aggregate approximately 10% ownership in the first reactor unit in the form of common stock. Any shortfall will have to be funded through such things as debt financing, cost-sharing by contractors and suppliers, or public offering.

While the success of the Project does not depend on financial assistance from the government, management believes that based on the 2005 Energy Policy Act, the Project may be eligible for an 80% Federal loan guarantee for the construction of new nuclear facilities, and an applicable Federal tax credit of $1.0 billion over eight years, which should be sufficient to cover all operating expenses during that timeframe. Furthermore, the excess heat from this plant will be used to produce biofuels from local crops and agricultural waste.

The intended use of the funds for the Reactor Land project is approximately 8% of the total shown below:

	In millions
Payment to owner for site land		5
Payment for COLA plus 10% price escalation due to delays		50
Payments for third party project management, engineering and G&A		25
Additional water rights		20
Long lead time equipment deposit: reactor vessel and turbine		50
Total	$	150

From inception through December 31, 2011, the Reactor Land Development private placement has raised gross proceeds of $1,000,000 in exchange for a 1% equity interest in Reactor Land. If the Reactor Land Development private placement does not raise the entire $150 million listed above, the Company will seek to raise the remaining balance through a public or private equity offering. The Company may adjust the budget categories in the execution of its permitting and development plans. The above line items represent managements best estimates, none of the line items is to be considered fixed or unchangeable.

Although the Company reserves the right to reallocate the funds according to field experience, the Company believes that the net proceeds from the planned offering will be sufficient to fund its initial capital requirements for the next year for operations. The foregoing assumes the offering will be fully subscribed, but there can be no assurance the Company will not require additional funds if unforeseen issues arise. Any additional required funds over the maximum offering amount will need to be financed as a loan. The availability and terms of any future financing will depend on market and other conditions. The amount of proceeds and uses are based upon the projections by management, which may also change according to unforeseen future events and market changes. There are no commitments for loans as of Decembr 31, 2011.

In the continuance of the Company’s business operations it does not intend to purchase or sell any significant assets and the Company does not expect a significant change in the number of its employees.

In addition, the United States and the global business community is experiencing severe instability in the commercial and investment banking systems which is likely to continue to have far-reaching effects on the economic activities in the country for an indeterminable period. The long-term impact on the United States economy and the Company’s operating activities and its ability to raise capital cannot be predicted at this time, but could be substantial.

Project Economics

The Company believes that if it is able to raise $150 million, it may develop a site licensed for construction of the advanced reactor by the end of 2015. The Company believes that by acquiring and obtaining the required permits and approvals for the proposed site now, it will be able to offer a site and an NRC license 3 to 4 years sooner than might otherwise be achievable, which will offer additional value to the Idaho site due to earlier power generation/revenue potential of the site.

Results Of Operations

Year Ended December 31, 2011 Compared To Year Ended December 31, 2010

During the year ended December 31, 2011, we recognized revenue of $923,650 compared to no revenue for the year ended December 31, 2010 from our operational activities. The increase in revenues wad due to the sales of five Energy Neutral homes during 2011. During the year ended December 31, 2010, we incurred operating expenses of $3,918,247 compared to $8,634,438 during the year ended December 31, 2010. The decrease of $4,716,191 was a result of a significant decrease in the operational activities of the Company over the prior year, primarily related to decreases in consulting services, marketing, public relations, board/officer services and legal expenses related to the Project. During the year ended December 31, 2011, we incurred the following changes in our operational expenses over the prior year.

	December 31, 2011		December 31, 2010		Increase or (Decrease)

Consulting services	$	719,360	$	3,716,830	$	(2,997,470	)
Marketing services	$	6,740	$	293,806	$	(287,066	)
Public relations	$	77,430	$	293,806	$	(216,376	)
Legal Fees	$	506,499	$	753,090	$	(246,591	)
Board/Officer Services	$	790,941	$	2,186,000	$	(1,395,059	)

During the year ended December 31, 2011, we incurred a net loss of $4,092,166 compared to a net loss of $8,487,722 in the year ended December 31, 2010. The decrease of $4,395,556 in net losses was a result of the $4,716,191 decrease in operational expenses for the year ended December 31, 2011. The Company’s basic and diluted loss per share was $0.01 in 2011 versus a basic and diluted loss per share of $0.03 in 2010.

Liquidity

At December 31, 2011, the Company had cash and cash equivalents of $268,691. Total current assets were $3,833,450 included monies held in escrow in the amount of $2,018,500 that were not available for working capital at December 31, 2011. Current liabilities were $102,782. The current assets exceeded current liabilities by $3,730,668.

Net cash used in operating activities during the year ended December 31, 2011 was $3,232,065 compared to net cash used in operating activities during the year ended December 31, 2010 of $2,930,100.

During the year ended December 31, 2011, the net cash used by operations represented $3,039,065, adjusted for certain non-cash items consisting of stock issued for services of $193,000. During the year ended December 31, 2010, the net cash provided by operations represented $2,730,677 adjusted for certain non-cash items consisting of stock for services and for land contract option fees totaling $5,660,777.

During the year ended December 31, 2011 the net cash used by investing activities was $5,344,830 compared to net cash used in investing activities during the year ended December 31, 2010 of $7,407,043. The decrease was due to decreased purchases and sales of short term investments in 2011.

During the year ended December 31, 2011, the Company used $60,000 from its financing activities. During the year ended December 31, 2010, the Company received $9,973,992 from its financing activities. The decrease of $9,913,992 was due to no stock sales for cash in 2011.

During the year ended December 31, 2011, the Company the Company did not sell any shares of its restricted common stock. During the year ended December 31, 2010, the Company received cash of $9,973,992 from the sale of 134,051,642 shares of its restricted common stock.

During the year ended December 31, 2011, the Company issued 1,875,000 shares of its restricted common stock in exchange for services valued at $193,000. Of such shares, 1,500,000 shares were issued to officers and directors in exchange for services valued of $153,000.

During the year ended December 31, 2010, the Company issued 54,136,041 shares of its restricted common stock in exchange for services valued at $5,094,064. During 2010, the Company issued 750,000 shares of its restricted common stock valued at $375,000 for two contract option fees. Of such shares issued in exchange for services, 33,000,000 shares were issued to officers and directors in exchange for services valued at $1,800,000.

Going Concern

Alternate Energy Holdings, Inc’s financial statements have been presented on the basis that it is a going concern, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. The Company has an accumulated deficit of $23,667,660 at December 31, 2011.

The Company’s continued existence is dependent upon its ability to raise capital or to successfully market and sell its products. The financial statements do not include any adjustments that might be necessary should the Company be unable to continue as a going concern.

Critical Accounting Policies

The Company has identified the policies below as critical to the Company business operations and the understanding of the Company results from operations. The impact and any associated risks related to these policies on the Company’s business operations is discussed throughout Management’s Discussion and Analysis of Financial Conditions and Results of Operations where such policies affect Tombstone’s reported and expected financial results. For a detailed discussion on the application of these and other accounting policies, see Note 1 in the Notes to the Consolidated Financial Statements beginning on page F-6 for the years ended December 31, 2011 and 2010. Note that the Company’s preparation of this document requires the Company to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the Company’s financial statements, and the reported amounts of expenses during the reporting periods.

Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect reported amounts of assets, liabilities, revenues and expenses and the and disclosures of contingent assets and liabilities. Accordingly, actual results could differ from those estimates. It is management’s opinion that all adjustments necessary for the fair statement of the results for the interim period have been made. All adjustments are of normal recurring nature or a description of the nature and amount of any adjustments other than normal recurring adjustments.

Cash and Cash Equivalents

The Company considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. Cash equivalents are stated at cost, which approximates fair value. The Federal Deposit Insurance Corporation insures deposit balances of up to $250,000 at December 31, 2011 and 2010. The uninsured balances at December 31, 2011 and 2010 were $-0-.

Stock-Based Compensation

The Company’s non-employees, share-based expense is recorded in accordance with FASB ASC 505-50 The Company has not issued any stock options or stock warrants since its inception through December 31, 2011.

Recently-Issued Accounting Pronouncements

The Company does not expect the adoption of any recently issued accounting pronouncements to have a significant impact on their financial position, results of operations, or cash flow.

Item 7A. Quantitative and Qualitative Disclosures About Market Risk

The Company’s operations do not employ financial instruments or derivatives which are market sensitive. Short term funds are held in non-interest bearing accounts and funds held for longer periods are placed in interest bearing accounts. Large amounts of funds, if available, will be distributed among multiple financial institutions to reduce risk of loss. Our cash holdings do not generate interest income.

Item 8. Financial Statements and Supplementary Data

The Audited Financial Statements that constitute Item 8 are attached at the end of this Annual Report from page F2 to F12. An Index to the Financial Statements is also included on page F-1 of this Annual Report.

Item 9. Changes In and Disagreements with Accountants on Accounting and Financial Disclosure

None.

Item 9A. Controls And Procedures

Management’s Annual Report on Internal Control over Financial Reporting

The Company maintains a system of disclosure controls and procedures that are designed for the purposes of ensuring that information required to be disclosed in our SEC reports is recorded, processed, summarized, and reported within the time periods specified in the SEC rules and forms, and that such information is accumulated and communicated to our management, including the Chief Executive Officer as appropriate to allow timely decisions regarding required disclosure.

Management, after evaluating the effectiveness of the Company’s disclosure controls and procedures as defined in Exchange Act Rules 13a-14(c) as of December 31, 2011 (the “Evaluation Date”) concluded that as of the Evaluation Date, the Company’s disclosure controls and procedures were effective to ensure that material information relating to the Company would be made known to them by individuals within those entities, particularly during the period in which this annual report was being prepared and that information required to be disclosed in our SEC reports is recorded, processed, summarized, and reported within the time periods specified in the SEC’s rules and forms.

Our management is responsible for establishing and maintaining adequate internal control over financial reporting for the company in accordance with as defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act. Our internal control over financial reporting is designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles. Our internal control over financial reporting includes those policies and procedures that:

(1)

pertain to the maintenance of records that, in reasonable detail, accurately and fairly reflect the transactions and dispositions of our assets;

(2)

provide reasonable assurance that transactions are recorded as necessary to permit preparation of financial statements in accordance with generally accepted accounting principles, and that our receipts and expenditures are being made only in accordance with authorizations of our management and directors; and

(3)

provide reasonable assurance regarding prevention or timely detection of unauthorized acquisition, use or disposition of our assets that could have a material effect on our financial statements.

Management’s assessment of the effectiveness of the registrant’s internal control over financial reporting is as of the year ended December 31, 2011. We believe that internal control over financial reporting is effective. We have not identified any, current material weaknesses considering the nature and extent of our current operations and any risks or errors in financial reporting under current operations.

Because of its inherent limitations, internal control over financial reporting may not prevent or detect misstatements. Also, projections of any evaluation of effectiveness to future periods are subject to the risk that controls may become inadequate because of changes in conditions, or that the degree of compliance with the policies or procedures may deteriorate.

This annual report does not include an attestation report of the Company’s registered public accounting firm regarding internal control over financial reporting. Management’s report was not subject to attestation by the Company’s registered public accounting firm pursuant to temporary rules of the Securities and Exchange Commission that permit the Company to provide only management’s report in this annual report.

There was no change in our internal control over financial reporting that occurred during the fiscal quarter ended December 31, 2011, that has materially affected, or is reasonably likely to materially affect, our internal control over financial reporting.

Item 9B. Other Information

Not applicable.

PART III

Item 10. Directors, Executive Officers and Corporate Governance

The following table sets forth information as to persons who currently serve as the Company directors or executive officers, including their ages, as of April 2, 2012. There is no blood or other familiar relationship between or among or directors or executive officers.

NAME	AGE	POSITION
Donald Gillispie	67	President, Chief Executive Officer, Chairman, Director
Howard Butcher IV	75	Director
Rick J. Bucci	45	Vice President and Chief Financial Officer
Glenda Baskin Glover	58	Director
Kenneth A. Strahm Sr.	75	Director
James Ryan Holt	50	Director
Michael T. Coyle	68	Director

The Company’s officers are elected by the board of directors at the first meeting after each annual meeting of the Company’s shareholders and hold office until their successors are duly elected and qualified under the Company’s bylaws.

The directors named above (other than those who have since resigned) will serve until the next annual meeting of the Company’s stockholders. Thereafter, directors will be elected for one-year terms at the annual stockholders’ meeting. Officers will hold their positions at the pleasure of the board of directors absent any employment agreement. There is no arrangement or understanding between the directors and officers of the Company and any other person pursuant to which any director or officer was or is to be selected as a director or officer. The directors of the Company devote part-time to the business affairs and the officers devote full-time to the business.

Biographical Information

Donald Gillispie, President, Chief Executive Officer, Chairman and Director

A past nuclear utility senior executive and current Chairman, Mr. Gillispie has served as President and Chief Executive Officer of the Company since inception. Mr. Gillispie has been the owner of Grace Glens Consulting since 2002, a technical management consulting company, which advises senior utility executives on managing commercial nuclear power companies, and other non-nuclear organizations. Mr. Gillispie helped start up a technical management consulting business, INPO, in Atlanta, Georgia and a nuclear operating company, NMC, in Hudson, Wisconsin, which operated six nuclear power plants, with approximately 5,000 employees. Mr. Gillispie served as a director for Boston Edison. Mr. Gillispie has a Bachelor of Science in Electrical Engineering from Clemson University. He completed the Senior Executive Program at the Massachusetts Institute of Technology. In addition, Mr. Gillispie completed the Navy Nuclear program. The Board of Directors concluded that Mr. Gillispie should serve as a director in light of his extensive nuclear power background and combined with the perspective and experience he brings as our current President and Chief Executive Officer from his history with the Company.

Rick J. Bucci, Vice President and Chief Financial Officer

Mr. Bucci, a certified public Accountant, has served as Chief Financial Officer of the Company since September 2007. Mr. Bucci has 23 years of experience in the field of accounting and tax in various industries such as hospitality, construction, real estate development and banking. Additionally, he served as CFO of two corporations, Veterans Outreach Center and Finger Lakes Family Care, Inc. His experience includes tax planning and preparation, audit services, financial statement preparation and presentation, bank financing and various consulting engagements. Mr. Bucci currently owns and operates a Certified Public Accounting firm, Rick J. Bucci, CPA, which is licensed to practice public accounting in New York State and has over 350 clients. He attended the State University of New York at Geneseo (1984 through 1988) where he received a Bachelor of Science in Accounting.

Kenneth A. Strahm, Sr., Director

Mr. Strahm, a past president of the nuclear industry watchdog organization INPO, has served on the Board of the Company since September 2006. Mr. Strahm was employed by the Institute of Nuclear Power Operations (INPO) in Atlanta, Georgia, where he served as the Director of the National Academy for Nuclear Training and later as President of the Institute. Mr. Strahm attended the Naval Academy where he received a BS in Marine Engineering. He also attended the Naval Post Graduate School and obtained an MBA. The Board of Directors concluded that Mr. Strahm should serve as a director in light of his extensive nuclear power background.

Glenda Baskin Glover, Director

Dr. Glover, who was appointed to our Board of Directors in June 2011, has been the Dean of the College of Business of Jackson State University since 1994. From 1990 to 1994, she was the Chairperson of the Department of Accounting and an Assistant Professor at Howard University. Dr. Glover has also recently served as a director of other public corporations. Dr. Glover has served on the board of directors of The Student Loan Corporation (1998-2011), where she most recently served as the Chair of the Audit Committee, as a member of the Compensation Committee, and as the financial expert to the board. Dr. Glover also has served on the board of directors of The Lenox Group, Inc. (2006-2009) where she served as a member of the Audit Committee. Dr. Glover was formerly the Chief Financial Officer and Senior Vice President of Metters Industries, Inc., an engineering and manufacturing company (1985-1990), and an accountant at Arthur Anderson & Co. (1976-1978). Dr. Glover earned her BS in Mathematics from Tennessee State University in 1974, her MBA in Accounting from Clark-Atlanta University in 1976, her Ph.D. in economics and business from George Washington University in 1990, and her J.D. from Georgetown University Law Center in 1994. Dr. Glover is also a Certified Public Accountant.

Michael T. Coyle, Director

Rear Admiral Coyle, who was appointed to our Board of Directors in February 2012, served over thirty-three years as a United States Naval Officer where he gained extensive experience in operations, engineering and maintenance of nuclear and conventional power systems. In addition, Rear Admiral Coyle has in excess of eleven years of senior manager and executive experience in the commercial nuclear power field and two and a half years as a Department of Energy contractor. Rear Admiral Coyle currently serves as Manager of Nuclear Safety, Quality Culture and Commissioning Support for the Hanford Waste Treatment and Immobilization Plant Project in Richland, Washington, a position he has held since 2009. From 2006 to 2009, Rear Admiral Coyle served as Vice President of Special Projects for Exelon Nuclear, where his responsibilities included operation of Exelon’s six nuclear reactors in the Mid-Atlantic Region and preparations for operational safety inspections for all ten Exelon reactors in the Mid-Atlantic and Midwest regions. From 2004 to 2006, Rear Admiral Coyle was Vice President of Operations for the Nuclear Energy Institute in Washington, DC. Rear Admiral Coyle earned his BS in Engineering and Naval Science from the U.S. Naval Academy in 1954 and his MS in Mechanical Engineering from the U.S. Naval Postgraduate School in 1976. Rear Admiral Coyle also completed the Pennsylvania State University Executive Management Program in 1984, received Naval Nuclear Propulsion Training from 1965 to 1966 and completed U.S. Navy Engineering Duty Officer School Basic and Senior Courses and U.S. Navy Submarine Officer School.

James Ryan Holt, Director

James Ryan Holt, who was appointed to our Board of Directors in February 2012, is a successful Idaho business man has been the owner and operator of an independent insurance agency in Fruitland, Idaho, for the past seven plus years and prior to starting his own agency was an insurance agent with State Farm Insurance from 1996 to 2003. Prior to joining State Farm Insurance, Mr. Hold was in sales for MCI Communications McCaw Communications and Cellular One. Mr. Holt earned his bachelors degree in Business Administration/Finance from Boise State University in 1987.

Howard Butcher IV, Director

Mr. Howard Butcher, IV, who was appointed to our Board of Directors in March 2012, has over fifty years of experience as an advisor or principal in corporate finance, venture capital and investment and corporate management across a broad range of industries, including the energy, natural resources and power generation industries. Mr. Butcher is currently the Secretary and a member of the Board of Directors of Butcher Energy, Inc., positions he has held since the early 1990’s. Butcher Energy is a privately owned energy firm focused on oil and gas exploration and development, wind and solar farm development in Texas and other alternative energy projects, but not limited to these fields. Mr. Butcher is also currently a Vice President and a member of the board of directors of Philadelphia Bourse, Inc., positions he has held since before 1990. Philadelphia Bourse, Inc. is a privately owned holding company which owns operating companies in various industries, including electrical contracting and propeller design, manufacturing and distribution. Mr. Butcher attended the University of Pennsylvania

Involvement in Certain Legal Proceedings

Currently, an action initiated by the U.S. Securities and Exchange Commission (“SEC”) is pending in the U.S. District Court for the District of Idaho, alleging, among other things, that our company, and certain of our officers and directors, including our President, CEO and director, Donald Gillispie, violated the federal securities laws by issuing materially false and misleading statements, artificially inflating the company’s stock price, and subsequently liquidating the stock through secret sales (the “SEC Action”). The company’s accounts were frozen on December 18, 2010 following the filing of the civil complaint by the SEC in connection with the SEC Action; however, a federal judge subsequently dropped the freeze on all of the company’s assets on February 4, 2011. In connection with the SEC Action, and the dropping of the asset freeze, Mr. Gillispie agreed to an order pursuant to which he agreed not to violate Section 17(a) of the Securities Act, Section 10(b) of the Exchange Act and Rule 10b-5 there under, and Section 16(a) of the Exchange Act and Rule 16a-3 there under.

Code of Ethics

The Company has adopted a Code of Ethics that applies to all of its directors, officers and employees. The Code of Ethics is filed as an exhibit to this Form 10-K. The Company will provide to any person without charge, upon request to the Company at its office, a copy of the Code of Ethics. Any waiver of the provisions of the Code of Ethics for executive officers and directors may be made only by the Audit Committee and, in the case of a waiver for members of the Audit Committee, by the Board of Directors. Any such waivers will be promptly disclosed to our shareholders.

Compliance with Section 16(a) of the Exchange Act

Section 16(a) of the Exchange Act requires a reporting company’s executive officers, directors and persons who own more than 10% of a registered class of the company’s equity securities (“Reporting Person”) to report ownership and changes in ownership with the SEC on Form 3, 4 and 5.

Based solely upon a review of Forms 3 and 4 and amendments thereto furnished to the Company during the fiscal year ended December 31, 2011, and Forms 5 and amendments thereto furnished to the Company with respect to the fiscal year ended December 31, 2011, the Company has determined that the following Reporting Persons have failed to comply with the Section 16(a) of the Exchange Act on a timely basis.

Committees of the Board of Directors

The Board of Directors has four standing committees: the Executive Committee the Audit Committee, the Compensation Committee and the Governance and Nominating Committee. Each of the four committees maintains a written charter approved by the Board of Directors. The following is a summary of our fourstanding committees:

Executive Committee

Members of the Company’s Executive Committee are Kenneth A Strahm Sr. (Chairman) and Donald Gillispie.

Audit Committee

The Board of directors formed an audit committee in March 2007. Due to board turnover the only current members of the Audit Committee are Glenda Baskin Glover and Howard Buthcher IV. The audit committee is comprised solely of directors who are independent and financially literate, as required by the Securities Exchange Act of 1934. At least one member of the committee has accounting or related financial management expertise. The purpose of the Audit Committee is to represent and assist the Board of Directors in its general oversight of the Company’s accounting and financial reporting processes, audits of the financial statements, and internal control and audit functions.

Compensation Committee

The Board of Directors formed the Compensation Committee and adopted a formal written charter in January 2012. The members of the Compensation Committee presently are Dr. Glover and Mr. Strahm (Chairman). The purpose of the Compensation Committee is to represent and assist the Board of Directors to discharge the responsibilities of the Company’s Board of Directors relating to compensation of the Company’s executives, to produce an annual report on executive compensation for inclusion in the Company’s proxy statement, and to oversee and advise the Board of Directors of the Company on the adoption of policies that govern the Company’s compensation programs, including stock and benefit plans.

Governance and Nominating Committee

The Board of Directors formed the Governance and Nominating Committee and adopted a formal written charter in January 2012. The members of the Governance and Nominating Committee are Dr. Glover and Mr. Strahm (Chairman). The purpose of the Governance and Nominating Committee is to determine the slate of director nominees for election to the Company’s Board of Directors, to identify and recommend candidates to fill vacancies occurring between annual general meetings, to review, evaluate and recommend changes to the Company’s Corporate Governance Guidelines, and to review the Company’s policies and programs that relate to matters of corporate responsibility, including public issues of significance to the Company and its stockholders.

Previous “Blank Check” or “Shell” Involvement

Management of the Company has not been involved in prior private “blank-check” or “shell” companies.

Conflicts of Interest – General

Certain officers and directors of the Company may be directors and/or principal shareholders of other companies and, therefore, could face conflicts of interest with respect to potential acquisitions. In addition, officers and directors of the Company may in the future participate in business ventures, which could be deemed to compete directly with the Company. Additional conflicts of interest and non-arms- length transactions may also arise in the future in the event the Company’s officers or directors are involved in the management of any firm with which the Company transacts business. The Company’s Board of Directors has adopted a policy that the Company will not seek a merger with, or acquisition of, any entity in which management serve as officers or directors, or in which they or their family members own or hold a controlling ownership interest. Although the Board of Directors could elect to change this policy, the Board of Directors has no present intention to do so. In addition, if the Company and other companies with which the Company’s officers and directors are affiliated both desire to take advantage of a potential business opportunity, then the Board of Directors has agreed that said opportunity should be available to each such company in the order in which such companies registered or became current in the filing of annual reports under the Exchange Act subsequent to January 1, 1997.

The Company’s officers and directors may actively negotiate or otherwise consent to the purchase of a portion of their common stock as a condition to, or in connection with, a proposed merger or acquisition transaction. It is anticipated that a substantial premium over the initial cost of such shares may be paid by the purchaser in conjunction with any sale of shares by the Company’s officers and directors which is made as a condition to, or in connection with, a proposed merger or acquisition transaction. The fact that a substantial premium may be paid to the Company’s officers and directors to acquire their shares creates a potential conflict of interest for them in satisfying their fiduciary duties to the Company and its other shareholders. Even though such a sale could result in a substantial profit to them, they would be legally required to make the decision based upon the best interests of the Company and the Company’s other shareholders, rather than their own personal pecuniary benefit.

Item 11. Executive Compensation

The following table sets forth the compensation (including salary, bonus, and certain other compensation) paid to the officers during the fiscal years ended December 31, 2011 and 2010.

Summary Executives Compensation Table

Name and Position	Year	Salary ($)	Bonus ($)	Stock Awards ($)	Option Awards ($)	All Other compensation ($)	Total ($)
Donald Gillispie, President CEO, Chairman and Director (1)	2011	0	0	-0-	0	$476,200	476,200
Donald Gillispie, President CEO, Chairman and Director (1)	2010	0	0	1,050,000	0	$393,200	1,443,200

Rick J. Bucci, Vice President, Chief Financial Officer (2)	2011	165,000	0	-0-	0	-0-	165,000
Rick J. Bucci, Vice President, Chief Financial Officer (2)	2010	0	0	450,000	0	0	450,000

(1)

During the year ended December 31, 2011, Mr. Gillispie did not receive any shares of common stock as compensation for his services; and $476,200 of other compensation. During the year end December 31, 2010, Mr. Gillispie received 15,000,000 shares of common stock at $.05 per share as compensation for his services. With respect to amounts representing other compensation for the years ended December 31, 2011 and 2010, $476,200 and $393,200, respectively, represent amounts paid to Energy Executives, LLC and Professional Energy Consulting, LLC, Mr. Gillispie’s consulting business. Mr. Gillispie is paid by us as an independent contractor.

(2)

During the year ended December 31, 2011, Mr. Bucci received compensation of $165,000 for his services and did not receive any common stock. During the year ended December 31, 2010, Mr. Bucci received 7,000,000 shares of common stock valued at $.05 per share and 1,000,000 shares of common stock valued at $.10 per share as compensation.

Option/SAR Grants in the Last Fiscal Year

The Company does not have a stock option plan as of the date of this annual report. There was no grant of stock options to the Chief Executive Officer and other named executive officers during the fiscal years ended December 31, 2011 and 2010.

Employment Agreements and Termination of Employment and Change-In-Control Arrangements

None of the Company’s officers, directors, advisors, or key employees is currently party to employment agreements with the Company. The Company has no pension, health, annuity, bonus, insurance, stock options, profit sharing or similar benefit plans; however, the Company may adopt such plans in the future. There are presently no personal benefits available for directors, officers, or employees of the Company.

Compensation Committee Interlocks and Insider Participation

The Company’s board of directors acts in its entirety as the compensation committee for the Company. Mr. Gillispie is the Chief Executive Officer and Chairman of the Company.

Compensation Committee Report

The board of directors has reviewed and discussed the following with the management:

(i) the objectives of the company’s compensation programs; (ii) what the compensation program is designed to reward; (iii) each element of compensation; (iv) why the company chooses to pay each element; (v) how the company determines the amount (and, where applicable, the formula) for each element to pay; and (vi) how each compensation element and the company's decision regarding that element fit into the company's overall compensation objectives and affect decisions regarding other elements.

Director Compensation

The Company does not pay any directors fees for meeting attendance. An Audit Committee has been established; however no compensation has been paid for this function to date.

The following table sets forth the director compensation of our non-employee directors of during the year ended December 31, 2011.

Name	Fees Earned or Paid in Cash ($)		Stock Awards ($)(1)		Option Awards ($)		Total ($)
John Franz (2)		0		30,000		0		30,000
Kenneth Strahm		0		30,000		0		30,000
Ralph Beedle (2)		0		30,000		0		30,000
Glenda Baskin Glover		0		33,000		0		33,000
Mike Sellman (2)		0		30,000		0		30,000

(1)	During the year ended December 31, 2011, Mr. Franz, Mr. Strahm, Mr. Beedle, Ms. Baskin Glover, and Mr. Sellman each received 300,000 shares of the Company’s common stock value at $.10 and .11 per share for their services as non-employee directors.

(2)	Mr. Franz and Mr. Beedle resigned from the Board of Directors in February 2012 and Mr. Sellman resigned from the Board of Directors in March 2012.

Limitation on Liability and Indemnification

The Company is a Nevada corporation. The Nevada Revised Statutes (NRS) provides that the articles of incorporation of a Nevada corporation may contain a provision eliminating or limiting the personal liability of a director to the corporation or its shareholders for monetary damages for breach of fiduciary duty as a director, except that any such provision may not eliminate or limit the liability of a director (i) for any breach of the director’s duty of loyalty to the corporation or its shareholders, (ii) acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law, (iii) acts specified in Section 78 (concerning unlawful distributions), or (iv) any transaction from which a director directly or indirectly derived an improper personal benefit. The Company’s articles of incorporation contain a provision eliminating the personal liability of directors to the Company or the Company shareholders for monetary damages to the fullest extent provided by the NRS.

The NRS provides that a Nevada corporation must indemnify a person who was wholly successful, on the merits or otherwise, in defense of any threatened, pending, or completed action, suit, or proceeding, whether civil, criminal, administrative, or investigative and whether formal or informal (a “Proceeding”), in which he or she was a party because the person is or was a director, against reasonable expenses incurred by him or her in connection with the Proceeding, unless such indemnity is limited by the corporation’s articles of incorporation. The Company’s articles of incorporation do not contain any such limitation.

The NRS provides that a Nevada corporation may indemnify a person made a party to a Proceeding because the person is or was a director against any obligation incurred with respect to a Proceeding to pay a judgment, settlement, penalty, fine (including an excise tax assessed with respect to an employee benefit plan) or reasonable expenses incurred in the Proceeding if the person conducted himself or herself in good faith and the person reasonably believed, in the case of conduct in an official capacity with the corporation, that the person’s conduct was in the corporation’s best interests and, in all other cases, his or her conduct was at least not opposed to the corporation’s best interests and, with respect to any criminal proceedings, the person had no reasonable cause to believe that his or her conduct was unlawful. The Company’s articles of incorporation and bylaws allow for such indemnification. A corporation may not indemnify a director in connection with any Proceeding by or in the right of the corporation in which the director was adjudged liable to the corporation or, in connection with any other Proceeding charging that the director derived an improper personal benefit, whether or not involving actions in an official capacity, in which Proceeding the director was judged liable on the basis that he or she derived an improper personal benefit. Any indemnification permitted in connection with a Proceeding by or in the right of the corporation is limited to reasonable expenses incurred in connection with such Proceeding.

The NRS, unless otherwise provided in the articles of incorporation, a Nevada corporation may indemnify an officer, employee, fiduciary, or agent of the corporation to the same extent as a director and may indemnify such a person who is not a director to a greater extent, if not inconsistent with public policy and if provided for by its bylaws, general or specific action of its board of directors or shareholders, or contract. The Company’s articles of incorporation provide for indemnification of directors, officers, employees, fiduciaries and agents of the Company to the full extent permitted by Nevada law.

The Company’s articles of incorporation also provide that the Company may purchase and maintain insurance on behalf of any person who is or was a director or officer of the Company or who is or was serving at the request of the Company as a director, officer or agent of another enterprise against any liability asserted against him or her and incurred by him or her in any such capacity or arising out of his or her status as such, whether or not the Company would have the power to indemnify him or her against such liability.

Equity Compensation Plan Information

The Company has not established an equity compensation plan or Incentive Stock Option Plan.

Item 12. Security Ownership of Certain Beneficial Owners and Management and Related Stockholder Matters

The following table sets forth information with respect to the beneficial ownership of the Company outstanding common stock by:

•

each person who is known by the Company to be the beneficial owner of 5% or more of the Company’s common stock;

•

The Company’s chief executive officer, its other executive officers, and each director as identified in the “Management Executive Compensation” section; and

•

all of the Company’s directors and executive officers as a group.

Beneficial ownership is determined in accordance with the rules of the Securities and Exchange Commission and generally includes voting or investment power with respect to securities. Shares of common stock and options, warrants and convertible securities that are currently exercisable or convertible within 60 days of the date of this document into shares of the Company’s common stock are deemed to be outstanding and to be beneficially owned by the person holding the options, warrants or convertible securities for the purpose of computing the percentage ownership of the person, but are not treated as outstanding for the purpose of computing the percentage ownership of any other person.

The information below is based on the number of shares of the Company’s common stock that the Company believes was beneficially owned by each person or entity as of April 3, 2012

1. Name and Address of Beneficial Owner(1)	Number of Common Stock Beneficially Owned(2)	Percent of Class Beneficially Owned
Donald Gillispie, President, CEO, Chairman and Director	42,637,500	13.1%
Michael T. Coyle, Director	200,000	*
Rick J. Bucci, Vice President and Chief Financial Officer(3)	14,029,726	4.3%
Glenda Baskin Glover, Director	300,000	*
Kenneth A. Strahm, Sr., Director	2,800,000	*
James Ryan Holt, Director	200,000	*
Howard Butcher IV, Director	200,000	*
All directors and executive officers as a group (6 persons)	60,367,226	18.49%
* Less than 1%. (1) Except as noted above the business address for all listed individuals or entities is 911 E. Winding Creek Dr., Suite 150, Eagle, ID 83616. (2) On April 3, 2012, the Company had authorized common stock of 500,000,000, with 326,562,791 shares of its common stock issued and outstanding. (3) 14,025,000 shares held directly; 4,726 held indirectly through spouse.

Rule 13d-3 under the Securities Exchange Act of 1934 governs the determination of beneficial ownership of securities. That rule provides that a beneficial owner of a security includes any person who directly or indirectly has or shares voting power and/or investment power with respect to such security. Rule 13d-3 also provides that a beneficial owner of a security includes any person who has the right to acquire beneficial ownership of such security within 60 days, including through the exercise of any option, warrant or conversion of a security. Any securities not outstanding which are subject to such options, warrants or conversion privileges are deemed to be outstanding for the purpose of computing the percentage of outstanding securities of the class owned by such person. Those securities are not deemed to be outstanding for the purpose of computing the percentage of the class owned by any other person. Included in this table are only those derivative securities with exercise prices that the Company believes have a reasonable likelihood of being “in the money” within the next 60 days.

Item 13. Certain Relationships and Related Transactions

Not Applicable.

Item 14. Principal Accounting Fees and Services

EFP Rotenberg, LLP is the Company’s independent registered public accounting firm. The Company’s Board of Directors has considered whether the provisions of audit services are compatible with maintaining EFP Rotenberg, LLP’s independence.

The following table represents aggregate fees billed to the Company for the years ended December 31, 2011 and December 31, 2010 by EFP Rotenberg, LLP:

	Year Ended December 31,
	2011		2010
Audit Fees	$	56,439	$	24,300
Audit-related Fees	$	6,618	$	0
Tax Fees	$	0	$	0
All Other Fees	$	0	$	0
Total Fees	$	63,057	$	24,300
All audit work was performed by the firm's full-time employees.

PART IV

Item 15. Exhibits, Financial Statement Schedules

The following is a complete list of exhibits filed as part of this Form 10K. Exhibit number corresponds to the numbers in the Exhibit table of Item 601 of Regulation S-K.

(a) Audited financial statements for years ended December 31, 2011 and 2010, and the period from inception up to December 31, 2011, attached hereto from F-1 to F-12.

(b)

EXHIBIT NO.	DESCRIPTION
3.1	Articles of Incorporation of CorpTran Support, Inc. - 7/31/01 (1)
3.2	Certificate of Amendment - CorpTran Support, Inc. - 10/13/04(Stock amount changed to 75,000,000 @ $.001) (1)
3.3	Certificate of Amendment - Name change to dRx, Inc. - 12/15/04 (1)

3.4	Certificate of Amendment - Name change to Nussentials Holding, Inc. - 6/24/05 (1)
3.5	Certificate of Amendment - Name change to Alternate Energy Holdings, Inc. - 9/13/06 (1)
3.6	Certificate of Amendment - Alternate Energy Holdings, Inc. - 8/19/08 (Stock amount changed to 150,000,000 @ $.001) (1)
3.7	Bylaws of CorpTran Support, Inc. (1)
10.1	Land Purchase Agreement (1)
10.2	Construction Loan Letter (1)
10.3	Agreement to cooperate in the development of Joint Venture Agreement with the Nuclear Power Institute of China. -12/12/09 (2)
16	Changes in Registrant's Certifying Accountant – 10/01/09 (3)
21.1	List of Subsidiaries
31.1	Certification of Chief Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act
31.2	Certification of Chief Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act
32.1	Certification of Principal Executive Officer pursuant to Section 906 of the Sarbanes-Oxley Act
32.2	Certification of Principal Financial Officer pursuant to Section 906 of the Sarbanes-Oxley Act
101.INS*	XBRL Instance
101.SCH*	XBRL Taxonomy Extension Schema
101.CAL*	XBRL Taxonomy Extension Calculation
101.DEF*	XBRL Taxonomy Extension Definition
101.LAB*	XBRL Taxonomy Extension Labels
101.PRE*	XBRL Taxonomy Extension Presentation

(1)	Incorporated by reference from the exhibits included in the Company’s Form 10-12(g) filed with the Securities and Exchange Commission (www.sec.gov), dated October 1, 2008.

(2)	Incorporated by reference from the exhibits included in the Company’s Form 8-K filed with the Securities and Exchange Commission (www.sec.gov), dated December 17, 2009.

(3)	Incorporated by reference from the exhibits included in the Company’s Form 8-K filed with the Securities and Exchange Commission (www.sec.gov), dated October 10, 2009.

XBRL information is furnished and not filed or a part of a registration statement or prospectus for purposes of sections 11 or 12 of the Securities Act of 1933, as amended, is deemed not filed for purposes of section 18 of the Securities Exchange Act of 1934, as amended, and otherwise is not subject to liability under these sections.

SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned, thereunto duly authorized.

Alternate Energy Holdings, Inc.

By: /s/ Donald L. Gillispie Donald L. Gillispie President, Chief Executive Officer and Director (principal executive officer)	Dated: April 3, 2012

By: /s/ Rick J. Bucci Rick J. Bucci Vice-President and Chief Financial Officer (principal accounting officer)	Dated: April 3, 2012

Pursuant to the requirements of the Securities Exchange Act of 1934, this report has been signed below by the following persons on behalf of the registrant and in the capacities and on the dates indicated.


/s/ Donald L. Gillispie Donald L. Gillispie, President, CEO, COO and Director	Dated: April 3, 2012
/s/ Michael T. Coyle Michael T. Coyle, Director	Dated: April 3, 2012
/s/ Kenneth A. Strahm, Sr. Kenneth A. Strahm, Sr., Director	Dated: April 3, 2012
/s/ Howard Butcher, IV Howard Butcher, IV, Director	Dated: April 3, 2012
/s/ Glenda Glover Baskin Glenda Glover Baskin, Director	Dated: April 3, 2012
/s/ James Ryan Holt James Ryan Holt, Director	Dated: April 3, 2012

Alternate Energy Holdings, Inc.

Index to Consolidated Financial Statements

—INDEX—
	Page(s)
Report of Independent Registered Public Accounting Firm	F-2

Consolidated Financial Statements:

Balance Sheets
December 31, 2011 and 2010	F-3

Income Statements
Years ended December 31, 2011 and 2010, and the period from inception (August 29, 2005) through December 31, 2011	F-4

Statements of Changes in Stockholders’ Equity
Years ended December 31, 2011 and 2010, and the period from inception (August 29, 2005) through December 31, 2011	F-5 – F-7

Statements of Cash Flows
Years ended December 31, 2011 and 2010, and the period from inception (August 29, 2005) through December 31, 2011	F-8

Notes to Consolidated Financial Statements	F-9 – F-16

F-1

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and

Stockholders of Alternate Energy Holdings, Inc

(a development stage company)

We have audited the accompanying consolidated balance sheets of Alternate Energy Holdings, Inc (a development stage company) as of December 31, 2011 and 2010, and the related consolidated statements of income, change in stockholders’ equity, and cash flows for each of the years in the two-year period ended December 31, 2011 and for the period from inception (August 29, 2005) through December 31, 2011. Alternate Energy Holdings, Inc’s management is responsible for these consolidated financial statements. Our responsibility is to express an opinion on these consolidated financial statements based on our audits.

We conducted our audits in accordance with the standards of the Public Company Accounting Oversight Board (United States). Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. The company is not required to have, nor were we engaged to perform, an audit of its internal control over financial reporting. Our audit included consideration of internal control over financial reporting as a basis for designing audit procedures that are appropriate in the circumstances, but not for the purpose of expressing an opinion on the effectiveness of the company’s internal control over financial reporting. Accordingly, we express no such opinion. An audit also includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements, assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.

In our opinion, the consolidated financial statements referred to above present fairly, in all material respects, the financial position of Alternate Energy Holdings, Inc as of December 31, 2011 and 2010, and the results of its operations and its cash flows for each of the years in the two-year period ended December 31, 2011 and for the period from Inception (August 29, 2005) through December 31, 2011, in conformity with accounting principles generally accepted in the United States of America.

The accompanying consolidated financial statements have been prepared assuming that the Company will continue as a going concern. As discussed in Note 12 to the consolidated financial statements, these conditions raise substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 12. The consolidated financial statements do not include any adjustments relating to the recoverability and classification of asset carrying amounts or the amount and classification of liabilities that might result should the Company be unable to continue as a going concern.

/s/ EFP Rotenberg, LLP

EFP Rotenberg, LLP

Rochester, New York

April 3, 2012

F-2

ALTERNATE ENERGY HOLDINGS, INC.

(A Development Stage Company)

CONSOLIDATED BALANCE SHEETS

DECEMBER 31, 2011 AND 2010

ASSETS

	2011			2010
CURRENT ASSETS:
Cash and Cash Equivalents	$	268,691		$	234,426
Cash - Escrow		2,018,500			-
Prepaid Expenses		5,604			-
Short-Term Investments		1,540,655			6,916,498

Total Current Assets		3,833,450			7,150,924

PROPERTY AND EQUIPMENT - Net		61,099			70,595

OTHER ASSET
Assets Held for Sale - Energy Neutral Model Home		-			278,000
Construction in Progress - Energy Neutral Homes		-			298,657
Security Deposit		-			3,000
Total Other Assets		-			579,657


TOTAL ASSETS	$	3,894,549		$	7,801,176

LIABILITIES AND STOCKHOLDERS' EQUITY

CURRENT LIABILITIES
Accounts Payable	$	102,782		$	166,577
Due to Employee		-			60,000
Accrued Payroll		-			25,000

Total Current Liabilities		102,782			251,577

STOCKHOLDERS' EQUITY:
Common Stock, par value $.001, 500,000,000 shares authorized; 325,962,791 issued and 325,562,791 outstanding and 325,087,791 issued and 324,687,791 outstanding, respectively		325,963			325,088
Additional Paid in Capital		27,255,903			27,063,778
Accumulated Other Comprehensive Income (Loss)		(102,439	)		(243,773	)
Treasury Stock (400,000 shares at cost)		(20,000	)		(20,000	)
Deficit Accumulated During Development Stage		(23,667,660	)		(19,575,494	)

Total Stockholders' Equity		3,791,767			7,549,599

TOTAL LIABILITIES AND STOCKHOLDERS' EQUITY	$	3,894,549		$	7,801,176

The accompanying notes are an integral part of these financial statements.

F-3

ALTERNATE ENERGY HOLDINGS, INC.

(A Development Stage Company)

CONSOLIDATED INCOME STATEMENTS
FOR THE YEARS ENDED DECEMBER 31, 2011 AND 2010

AND THE PERIOD FROM INCEPTION (AUGUST 29, 2005) THROUGH DECEMBER 31, 2011

	Year Ended			Year Ended			Inception to
	December 31			December 31			December 31
	2011			2010			2011

REVENUES	$	923,650		$	-		$	923,650

COST OF SALES		929,237			-			929,237

GROSS PROFIT		(5,587	)		-			(5,587	)

OPERATING EXPENSES:
General and Administrative Expenses		3,918,247			8,634,438			24,676,238

NET LOSS FROM OPERATIONS		(3,923,834	)		(8,634,438	)		(24,681,825	)

OTHER INCOME (EXPENSE)
Investment Income		276,664			132,766			441,617
Miscellaneous Income		-			3,707			9,186
(Loss) Gain on Sales of Investments		(444,948	)		149,136			(294,185	)
Impairment on Deposit		-			(100,000	)		(100,000	)
Impairment on Asset Held for Sale		-			(38,419	)		(38,419	)
Interest Expense		(48	)		(474	)		(4,034	)
Total Other Income (Expense)		(168,332	)		146,716			14,165

LOSS BEFORE NON-CONTROLLING INTEREST IN VARIABLE INTEREST ENTITY		(4,092,166	)		(8,487,722	)		(24,667,660	)

Non-Controlling Interest in Variable Interest Entity		-			-			1,000,000

Net Loss	$	(4,092,166	)	$	(8,487,722	)	$	(23,667,660	)

BASIC AND DILUTED
NET LOSS PER COMMON STOCK	$	(0.01	)	$	(0.03	)	$	-

WEIGHTED AVERAGE SHARES OUTSTANDING		325,717,999			279,132,742			-

The accompanying notes are an integral part of these financial statements.

F-4

ALTERNATE ENERGY HOLDINGS, INC.

(A Development Stage Company)

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

AND THE PERIOD FROM INCEPTION (AUGUST 29, 2005) THROUGH DECEMBER 31, 2011

													Accumulated
			Number of				Additional						Other
	Price per		Common		Common		Paid in			Treasury			Comprehensive		Net
	Share		Shares Issued		Stock		Capital			Stock			Income		Loss			Total
Founder Shares issued August 29, 2005		-		14,800,000	$	14,800	$	(14,800	)	$	-		$	-	$	-		$	-
Issuance of Common Stock for Services
October		0.0176		3,249,999		3,250		54,250			-			-		-			57,500
Amortization of common stock for services
October				-		-		8,750			-			-		-			8,750
November				-		-		8,750			-			-		-			8,750
December				-		-		8,750			-			-		-			8,750
Issuance of Common Stock for Payables:
September		0.0417		600,000		600		24,400			-			-		-			25,000
November		0.0500		300,000		300		14,700			-			-		-			15,000
Net Loss				-		-		-			-			-		(100,692	)		(100,692	)
Balances, December 31, 2005				18,949,999		18,950		104,800			-			-		(100,692	)		23,058
Nussential Holdings Inc. shareholdersprior to merger		-		4,252,088		4,252		(4,252	)		-			-		-			-
Issuance of Common Stock for Services
September		1.0077		1,149,999		1,150		1,157,599			-			-		-			1,158,749
November		0.9000		100,000		100		89,900			-			-		-			90,000
Amortization of common stock for services
January				-		-		8,750			-			-		-			8,750
February				-		-		8,750			-			-		-			8,750
March				-		-		8,750			-			-		-			8,750
April				-		-		8,750			-			-		-			8,750
May				-		-		8,750			-			-		-			8,750
June				-		-		8,750			-			-		-			8,750
July				-		-		8,750			-			-		-			8,750
August				-		-		8,750			-			-		-			8,750
Issuance of Common Stock for Cash
March		0.0500		1,000,000		1,000		49,000			-			-		-			50,000
May		0.0500		400,000		400		19,600			-			-		-			20,000
June		0.0500		100,000		100		4,900			-			-		-			5,000
October		0.6465		273,000		273		176,227			-			-		-			176,500
November		0.3333		116,000		116		38,550			-			-		-			38,666
December		0.4244		75,000		75		31,758			-			-		-			31,833
Purchase of Treasury Stock				-		-		-			(20,000	)		-		-			(20,000	)
Net Loss				-		-		-			-			-		(1,394,711	)		(1,394,711	)
Balances, December 31, 2006				26,416,086		26,416		1,738,082			(20,000	)		-		(1,495,403	)		249,095
Issuance of Common Stock for Services
February		0.5000		920,000		920		459,080			-			-		-			460,000
March		0.5000		300,000		300		149,700			-			-		-			150,000
April		0.2500		100,000		100		24,900			-			-		-			25,000
June		0.2500		550,000		550		136,950			-			-		-			137,500
August		0.4000		531,552		532		212,089			-			-		-			212,621
September		0.1055		4,583,200		4,583		478,697			-			-		-			483,280
October		0.4000		366,400		366		146,194			-			-		-			146,560
November		0.1453		457,000		457		65,943			-			-		-			66,400
December		0.1000		57,500		58		5,692			-			-		-			5,750
Issuance of Common Stock for Cash
January		0.5300		23,000		23		12,227			-			-		-			12,250
February		0.5000		55,000		55		27,445			-			-		-			27,500
March		0.5000		10,000		10		4,990			-			-		-			5,000
April		0.4000		25,000		25		9,975			-			-		-			10,000
May		0.2500		206,000		206		51,294			-			-		-			51,500
June		0.2389		180,000		180		42,820			-			-		-			43,000
July		0.2500		2,591,000		2,591		645,159			-			-		-			647,750
August		0.2494		2,521,036		2,521		626,238			-			-		-			628,759
September		0.2500		64,000		64		15,936			-			-		-			16,000
October		0.2500		20,000		20		4,980			-			-		-			5,000
November		0.2000		287,500		287		57,213			-			-		-			57,500
December		0.1000		2,451,000		2,451		242,649			-			-		-			245,100
Net Loss				-		-		-			-			-		(3,394,200	)		(3,394,200	)
Balances, December 31, 2007				42,715,274	$	42,715	$	5,158,253		$	(20,000	)	$	-	$	(4,889,603	)	$	291,365

The accompanying notes are an integral part of these financial statements.

F-5

ALTERNATE ENERGY HOLDINGS, INC.

(A Development Stage Company)

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

AND THE PERIOD FROM INCEPTION (AUGUST 29, 2005) THROUGH DECEMBER 31, 2011

												Accumulated
			Number of				Additional					Other
	Price per		Common		Common		Paid in		Treasury			Comprehensive		Net
	Share		Shares Issued		Stock		Capital		Stock			Income		Loss			Total
Issuance of Common Stock for Services
January		0.1000		1,312,250		1,312		129,913		-			-		-			131,225
February		0.1000		70,000		70		6,930		-			-		-			7,000
March		0.1000		183,250		183		18,142		-			-		-			18,325
April		0.1000		20,000		20		1,980		-			-		-			2,000
May		0.1000		14,556,875		14,557		1,441,131		-			-		-			1,455,688
June		0.1000		4,365,342		4,365		432,169		-			-		-			436,534
July		0.2000		798,625		798		158,927		-			-		-			159,725
August		0.2000		71,500		72		14,228		-			-		-			14,300
September		0.2000		25,430		25		5,061		-			-		-			5,086
October		0.2000		207,147		207		41,222		-			-		-			41,429
November		0.2000		10,853		11		2,160		-			-					2,171
December		0.1000		3,140,777		3,141		310,934		-			-					314,075
Issuance of Common Stock for Cash
January		0.1000		7,720,000		7,720		764,280		-			-		-			772,000
February		0.1000		1,120,750		1,121		110,954		-			-		-			112,075
March		0.1000		225,000		225		22,275		-			-		-			22,500
April		0.1000		250,000		250		24,750		-			-		-			25,000
May		0.1000		50,000		50		4,950		-			-		-			5,000
June		0.1000		576,000		576		57,024		-			-		-			57,600
July		0.1021		307,301		308		31,072		-			-		-			31,380
August		0.1549		182,000		182		28,018		-			-		-			28,200
September		0.2609		153,666		154		39,946		-			-		-			40,100
December		0.1000		125,000		125		12,375		-			-		-			12,500
Net Loss				-		-		-		-			-		(3,820,601	)		(3,820,601	)
Balances, December 31, 2008				78,187,040		78,187		8,816,694		(20,000	)		-		(8,710,204	)		164,677

Issuance of Common Stock for Services
January		0.1000		395,290		395		39,134		-			-		-			39,529
March		0.0500		138,065		138		6,765		-			-		-			6,903
April		0.0500		18,425,000		18,425		902,825		-			-		-			921,250
May		0.0500		945,400		945		46,325		-			-		-			47,270
June		0.0500		718,500		719		35,206		-			-		-			35,925
July		0.0500		755,000		755		36,995		-			-		-			37,750
August		0.0500		1,567,957		1,568		76,830		-			-		-			78,398
September		0.0500		1,431,340		1,431		70,136		-			-		-			71,567
October		0.0500		50,000		50		2,450		-			-		-			2,500
November		0.0500		441,580		442		21,637		-			-		-			22,079
December		0.0500		3,914,400		3,915		191,805		-			-		-			195,720
Issuance of Common Stock for Contract Option Fee
December		0.0500		500,000		500		24,500		-			-		-			25,000
Issuance of Common Stock for Cash
January		0.1000		25,000		25		2,475		-			-		-			2,500
February		0.0500		800,000		800		39,200		-			-		-			40,000
March		0.0500		330,600		330		16,200		-			-		-			16,530
April		0.0500		1,745,000		1,745		85,505		-			-		-			87,250
May		0.0500		700,000		700		34,300		-			-		-			35,000
June		0.0500		4,345,000		4,345		212,905		-			-		-			217,250
August		0.0500		440,000		440		21,560		-			-		-			22,000
September		0.0500		2,470,000		2,470		121,030		-			-		-			123,500
October		0.0500		3,509,000		3,509		171,941		-			-		-			175,450
November		0.0500		5,338,700		5,339		261,596		-			-		-			266,935
December		0.0500		8,977,236		8,977		439,933		-			-		-			448,910
Net Loss				-		-		-		-			-		(2,377,568	)		(2,377,568	)
Balances, December 31, 2009				136,150,108		136,150		11,677,947		(20,000	)		-		(11,087,772	)		706,325

The accompanying notes are an integral part of these financial statements.

F-6

ALTERNATE ENERGY HOLDINGS, INC.

(A Development Stage Company)

CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY

AND THE PERIOD FROM INCEPTION (AUGUST 29, 2005) THROUGH DECEMBER 31, 2011

														Accumulated
			Number of						Additional					Other
	Price per		Common			Common			Paid in		Treasury			Comprehensive			Net
	Share		Shares Issued			Stock			Capital		Stock			Income			Loss			Total
Issuance of Common Stock for Services
January		0.0500		17,500,000			17,500			857,500		-			-			-			875,000
February		0.0500		20,475,200			20,475			1,003,285		-			-			-			1,023,760
March		0.0500		1,307,546			1,308			64,069		-			-			-			65,377
April		0.0500		735,800			735			36,055		-			-			-			36,790
May		0.1000		100,000			100			9,900		-			-			-			10,000
June		0.1000		5,500,000			5,500			544,500		-			-			-			550,000
July		0.1500		5,854,465			5,854			872,316		-			-			-			878,170
August		0.5000		462,000			462			230,538		-			-			-			231,000
October		0.7000		145,000			145			101,355		-			-			-			101,500
November		0.7365		2,056,030			2,056			1,512,124		-			-			-			1,514,180
Issuance of Common Stock for Contract Option Fee
August		0.4000		500,000			500			199,500		-			-			-			200,000
September		0.7000		250,000			250			174,750		-			-			-			175,000
Issuance of Common Stock for Cash
January		0.0500		4,691,240			4,691			229,871		-			-			-			234,562
February		0.0500		42,188,960			42,189			2,067,259		-			-			-			2,109,448
March		0.0500		30,048,710			30,049			1,472,387		-			-			-			1,502,436
April		0.0500		4,610,000			4,610			225,890		-			-			-			230,500
May		0.1000		44,028,600			44,029			4,358,831		-			-			-			4,402,860
June		0.1000		7,348,580			7,349			727,509		-			-			-			734,858
July		0.4000		65,000			65			25,935		-			-			-			26,000
August		0.5000		425,000			425			212,075		-			-			-			212,500
September		0.7400		223,547			224			165,200		-			-			-			165,424
October		0.7000		279,145			279			195,123		-			-			-			195,402
November		0.7000		142,860			143			99,859		-			-			-			100,002
Comprehensive Loss:
Unrealized Loss on Short-Term Investments				-			-			-		-			(243,773	)		-			(243,773	)
Net Loss				-			-			-		-			-			(8,487,722	)		(8,487,722	)
Total Comprehensive Loss				-			-			-		-			-			-			(8,731,495	)
Balance - December 31, 2010				325,087,791		$	325,088		$	27,063,778	$	(20,000	)	$	(243,773	)	$	(19,575,494	)	$	7,549,599

Issuance of Common Stock for Services
April		0.1000		100,000			100			9,900		-			-			-			10,000
May		0.1031		1,750,000			1,750			178,750		-			-			-			180,500
September		0.1000		25,000			25			2,475		-			-			-			2,500
Cancellation of Common Stock for Services
June		0.7300		(1,000,000	)		(1,000	)		1,000		-			-			-			-
Comprehensive Loss:
Unrealized Gain on Short-Term Investments				-			-			-		-			141,334			-			141,334
Net Loss				-			-			-		-			-			(4,092,166	)		(4,092,166	)
Total Comprehensive Loss				-			-			-		-			-			-			(3,950,832	)

Balance - December 31, 2011				325,962,791		$	325,963		$	27,255,903	$	(20,000	)	$	(102,439	)	$	(23,667,660	)	$	3,791,767

The accompanying notes are an integral part of these financial statements.

F-7

ALTERNATE ENERGY HOLDINGS, INC.

(A Development Stage Company)

CONSOLIDATED STATEMENTS OF CASH FLOWS

FOR THE YEARS ENDED DECEMBER 31, 2011 AND 2010

AND THE PERIOD FROM INCEPTION (AUGUST 29, 2005) THROUGH DECEMBER 31, 2011

	Year Ended			Year Ended			Inception to
	December 31			December 31			December 31
	2011			2010			2011
CASH FLOWS FROM OPERATING ACTIVITIES:
Net Loss	$	(4,092,166	)	$	(8,487,722	)	$	(23,667,660	)
Adjustments to reconcile Net Loss to Net Cash
Used by Operating Activities -
Common Stock Issued for Services		193,000			5,285,777			12,629,836
Common Stock Issued for Contract Option Fee		-			375,000			400,000
Loss from Variable Interest Entity		-			-			(1,000,000	)
Impairment on Asset Held for Sale		-			38,419			38,419
Depreciation		14,900			8,894			23,794
Loss (Gain) on Sales of Investments		444,948			(149,136	)		294,185
Change in operating Assets and Liabilities -
Deposits		3,000			100,000			-
Prepaid Expenses		(5,604	)		11,220			(5,604	)
Construction in Progress - Energy Neutral Homes		298,657			(298,657	)		-
Accounts Payable		(63,800	)		161,105			102,777
Accrued Payroll		(25,000	)		25,000			-
Total Adjustments		860,101			5,557,622			12,483,407
Net Cash Used by Operating Activities		(3,232,065	)		(2,930,100	)		(11,184,253	)

CASH FLOWS FROM INVESTING ACTIVITIES:
Purchase of Fixed Assets		(5,404	)		(79,489	)		(84,893	)
Purchase of Short-Term Investments		(1,615,300	)		(14,096,925	)		(15,712,225	)
Proceeds from Sale of Short-Term Investments		6,687,534			7,047,371			13,736,532
Proceeds from Sale of Energy Neutral Model Home		278,000			-			278,000
Purchase of Energy Neutral Model Home		-			(278,000	)		(278,000	)
Net Cash Provided (Used) by Investing Activities		5,344,830			(7,407,043	)		(2,060,586	)

CASH FLOWS FROM FINANCING ACTIVITIES:
Receipt of Cash for Common Stock		-			9,913,992			14,552,030
Proceeds from Short-Term Borrowings		-			-			50,582
Payments on Short-Term Borrowings					-			(50,582	)
Cash - Esrow		(2,018,500	)		-			(2,018,500	)
Cash Received from Non-Controlling Members		-			-			1,000,000
Purchase of Treasury Stock		-			-			(20,000	)
Advance from Related Party		106,914			-			106,914
Payment to Related Party		(106,914	)		-			(106,914	)
Payment to Employee		(60,000	)		-			(60,000	)
Advance from Employee		-			60,000			60,000
Net Cash (Used) Provided by Financing Activities		(2,078,500	)		9,973,992			13,513,530

NET INCREASE(DECREASE) IN CASH		34,265			(363,151	)		268,691

CASH - BEGINNING		234,426			597,577			-

CASH - ENDING	$	268,691		$	234,426		$	268,691

Supplemental Disclosures:
Cash paid for Income Taxes	$	-		$	-		$	-
Cash paid for Interest	$	48		$	474		$	4,034

The accompanying notes are an integral part of these financial statements.

F-8

ALTERNATE ENERGY HOLDINGS, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

NOTE 1 – SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Description of Business

Alternate Energy Holdings, Inc., (and its subsidiaries Idaho Energy Complex, LLC, Green World Water, LLC, Energy Neutral, LLC and Reactor Development, LLC) formerly Nussentials Holdings Inc., is a development stage enterprise focused on the purchase, optimization and construction of green energy sources – primarily nuclear power plants.

Sunbelt Energy Resources Inc. was formed on August 29, 2005 to operate in the alternate energy industry and has limited operational activity. In September 2006, Sunbelt acquired Nussential Holdings, Inc. by exchanging 17,900,000 shares of Sunbelt which represented 100% for 21,399,998 shares of common stock of Nussential Holdings Inc. As a result of the acquisition, the shareholders of Sunbelt owned a majority of the voting stock of Nussentials Holdings, Inc. which changed its name to Alternate Energy Holdings, Inc. The merger has been accounted for as a reverse merger whereby Alternate Energy Holdings, Inc. is the accounting acquirer resulting in a recapitalization of Alternate Energy Holdings, Inc.’s equity. In connection with and simultaneous to the reverse merger, Nussentials Corporation, a wholly owned subsidiary of Nussentials Holdings Inc. was transferred to Nussential Holdings, Inc. majority shareholder through issuance of 4,252,088 shares of common stock.

Our Company

As noted above, we are a holding company comprised of 5 operating corporate entities: Idaho Energy Complex, LLC, Reactor Land Development, LLC, Energy Neutral, LLC, Energy Neutral Development, LLC and Green World Water, LLC (which was formed in 2010, and has succeeded to the business formerly conducted by a fifth, inactive subsidiary, International Reactors Incorporated).

Idaho Energy Complex, LLC

Reactor Land Development, LLC

Energy Neutral, LLC

Green World Water, LLC

F-9

ALTERNATE ENERGY HOLDINGS, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - continued

Estimates

The preparation of the consolidated financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect reported amounts of assets, liabilities, revenues and expenses and the and disclosures of contingent assets and liabilities. Accordingly, actual results could differ from those estimates.

Cash and Cash Equivalents

Alternate Energy Holdings, Inc. considers all highly liquid investments with an original maturity of three months or less to be cash equivalents. Cash equivalents are stated at cost, which approximates fair value. The Federal Deposit Insurance Corporation insures balances of up to $250,000 per institution at December 31, 2011 and December 31, 2010. The uninsured balances at December 31, 2011 and December 31, 2010 was $-0-.

Basic and Diluted Net Loss per Share

Basic and diluted net loss per share calculations are presented in accordance with FASB ASC 260-10 and are calculated on the basis of the weighted average number of common shares outstanding during the year. They include the dilutive effect of common stock equivalents in years with net income. Basic and diluted net loss per share is the same due to the absence of common stock equivalents.

Stock Based Compensation

Alternate Energy Holdings, Inc.’s non-employees, share-based expense is recorded in accordance with FASB ASC 505-50. Alternate Energy Holdings, Inc. has not issued any stock options or stock warrants since its inception through December 31, 2011.

F-10

ALTERNATE ENERGY HOLDINGS, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - continued

Fair Value Measurements

The Company considers fair value as the exchange price that would be received for an asset or paid to transfer a liability (an exit price) in the principal or most advantageous market for the asset or liability in an orderly transaction between market participants at the measurement date. The Company utilizes the following three-level fair value hierarchy to establish the priorities of the inputs used to measure fair value:

- Level 1 – Quoted prices in active market for identical assets or liabilities.

- Level 2 – Observable inputs other than quoted market prices included in Level 1, such as

quoted prices for similar assets and liabilities in active markets: quoted prices for identical or

similar assets and liabilities in markets that are not active: or other inputs that are observable or

can be corroborated by observable market data.

- Level 3 – Unobservable inputs that are supported by little or no market activity and that are

significant to the fair value of the assets or liabilities. This includes certain pricing models,

discounted cash flow methodologies and similar techniques that use significant unobservable

inputs.

Comprehensive Income (Loss)

Comprehensive income (loss) is comprised of net income (loss) and other comprehensive income (loss). Other Comprehensive income (loss) is primarily the result of unrealized gains and losses on Short-Term investments. The following table set forth the components of comprehensive income (loss):

	Year Ended
	December 31,
	2011			2010
Net Loss	$	(4,092,166	)	$	(8,487,722	)
Unrealized Loss on Short-Term Investments		(102,439	)		(243,773	)
Comprehensive Income	$	(4,194,605	)	$	(8,731,495	)

F-11

ALTERNATE ENERGY HOLDINGS, INC.

(A Development Stage Company)

NOTES TO FINANCIAL STATEMENTS

NOTE 1 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES - continued

Recently Issued Accounting Pronouncements

In June 2011, the FASB issued Accounting Standards Update (“ASU” 2011-05, Presentation of Comprehensive Income.) This ASU is intended to increase the prominence of other comprehensive income to financial statements by presenting components of net income and other comprehensive income in financial statements by presenting the components of net income and other comprehensive income in one continuous statement, referred to as the statement of comprehensive income, or two separate, but consecutive statements. The new guidance eliminates the current option to report other comprehensive income and it components in the statement of changes in stockholders’ equity. This new guidance is effective for fiscal years and interim periods beginning after December 15, 2011. While the new guidance changes the presentation of comprehensive income, there are no changes to the components that are recognized in net income or other comprehensive income under current accounting guidance: therefore, adoption of the new guidance in the first quarter fiscal 2012 will not have any impact on the Company’s consolidated financial position, results of operations or cash flows.

In May 2011, the FASB issued ASU 2011-04, (Amendments to Achieve Common Fair Value Measurement and Disclosure Requirements in U.S. GAAP and International Financial Reporting Standards (IFRSs”), which amends ACS 820, Fair Value Measurement. ASU 2011-04 does not extend the use of fair value accounting, but provides guidance on how it should be applied where its use is already required or permitted by other standards within U.S. GAAP or IFRSs. ASU 2011-14 changes the wording used to describe many requirements in U.S. GAAP for measuring fair value and for disclosing information about fair value measurements.

Additionally, ASU 2011-14 clarifies the FASB’s intent about the application of existing fair value measurements. ASU 2011-14 is effective for interim and annual periods beginning after December 15, 2011 and is applied prospectively; therefore, the Company will adopt ASU 2011-04 in its first quarter of fiscal 2012. The Company does not expect the adoption of ASU 2011-04 to have a material impact on its consolidated financial statements.

Alternate Energy Holdings, Inc. does not expect the adoption of any other recently issued accounting pronouncements to have a significant impact on their financial position, results of operations, or cash flow.

Revenue Recognition on Sale of Real Estate

Sales and the associated gains and losses of real estate assets are recognized in accordance with the provisions of ASC Topic 360-20., “Property, Plant and Equipment – Real Estate Sale”. The specific timing of a sale is measured against various criteria in ASC Topic 360-20 related to the transaction and any continuing involvement in the form of management of financial assistance associated with the properties.

The Company utilizes the full accrual method and if the criteria are not met, the Company defers some or all of the gain recognition and account for the continued operations of the property by applying the finance, leasing, deposit, installment or cost recovery methods, as appropriate, until the sale criteria are met.

F-12

NOTE 2 - INCOME TAXES

Alternate Energy Holdings, Inc. uses the liability method, where deferred tax assets and liabilities are determined based on the expected future tax consequences of temporary differences between the carrying amounts of assets and liabilities for financial and income tax reporting purposes. Alternate Energy Holdings, Inc. incurred net losses in the year ending December 31, 2011 and 2010 and therefore, has no tax liability. The deferred tax asset generated by the carry-forward is approximately $ 16,597,150 at December 31, 2010 and will expire in 2029.

Components of deferred tax assets at December 31, 2011 are as follows:

Deferred tax asset – net operating loss Carry-forwards	$	16,597,150
Valuation Allowance		(16,597,150	)
Net deferred tax asst	$	-0

The Company has adopted ASC 740-10 “Income Taxes”. As a result of the assessment the Company has recognized no material tax adjustments to the unrecognized tax benefits. At the adoption date of January 1, 2008 and as of December 31, 2010, the Company has no unrecognized tax benefits. By statue, tax years ending December 31, 2010 through 2008 remain open to examination by the major taxing jurisdictions to which the Company is subject.

The reconciliation of the effective income tax rate of the Company to the statutory income tax rate for the fiscal year ended on December 31, 2011 and 2010 is as follows:

	2011	2010
Federal Income Tax Rate	34%	34%
State Income Tax Rate	0%	0%
Increase in Valuation Allowance	(34%)	(34%)
Effective Tax Rate	0%	0%

NOTE 3 - COMMON STOCK

During 2006, Alternate Energy Holdings, Inc.

-	Issued 4,252,088 shares of common stock to the Nussential Holdings shareholders in the reverse merger – See Note 1 for the details.

-	Issued 1,249,999 shares of common stock valued at $ 1,318,749 for services.

-	Issued 1,964,000 shares of common stock for cash received in the amount of $ 321,999.

-	Purchase 400,000 shares of treasury stock for cash in the amount of $ 20,000.

During 2007, Alternate Energy Holdings, Inc.

-	Issued 7,865,652 shares of common stock valued at $ 1,687,111 for services.

-	Issued 8,433,536 shares of common stock for cash received in the amount of $ 1,749,359.

During 2008, Alternate Energy Holdings, Inc.

-	Issued 24,762,049 shares of common stock valued at $ 2,587,558 for services.

-	Issued 10,709,717 shares of common stock for cash received in the amount of $ 1,106,355.

During 2009, Alternate Energy Holdings, Inc.

-	Issued 28,282,532 shares of common stock valued at $ 1,433,891 for services.

-	Issued 500,000 shares of common stock valued at $25,000 for a contract option fee.

-	Issued 29,180,536 shares of common stock for cash received in the amount of $ 1,460,325.

F-13

ALTERNATE ENERGY HOLDINGS, INC.

(A Development Stage Company)

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

NOTE 3 - COMMON STOCK - continued

During 2010, Alternate Energy Holdings, Inc.

-	Issued 54,136,041 shares of common stock valued at $ 5,094,064 for services.

-	Issued 750,000 shares of common stock valued at $375,000 for two contract option fees.

-	Issued 134,051,642 shares of common stock for cash received in the amount of $9,913,992.

During 2011, Alternate Energy Holdings, Inc.

-	Issued 1,875,000 shares of common stock valued at $193,000 for services.

-	Cancelled 1,000,000 shares of common stock.

-	In June 2011, the Company and a consultant entered into an agreement to rescind 1,000,000 shares of

common stock previously awarded to them

-	Issued 25,000 shares of common stock valued at $25,000 for services

NOTE 4 - COMMITMENTS

Alternate Energy Holdings, Inc leases its office space under a two year lease and a home/office on a month-to-month basis under another lease. The two year lease is dated April 1, 2010 and expires April 30, 2012 and requires monthly payments of $2,000. Rent expense for the years ending December 31, 2011 and 2010 was $37,000 and $59,960, respectively. The following is a schedule of future minimum payments under the operating lease for the year ended December 31, 2011:

	For the year Ended December 31
2012		8,000
Total	$	8,000

Alternate Energy Holdings, Inc. has entered into three contracts dated December 11, 2009, August 10, 2010 and September 10, 2010 to purchase land in Idaho. This option holds the contract open until December 18, 2010, January 10, 2012 and September 10, 2011, respectively. The option dated September 10, 2010 was extended six months at a cost of a $500,000 nonrefundable deposit. The other two options were extended in December 2011 at a cost of a $400,000 nonrefundable deposits. The expenses of the other contracts are shown as Issuance of Common Stock for Option Fee on the Stockholder’s Equity statement.

NOTE 5 - VARIABLE INTEREST ENTITY

FASB ASC 810 requires consolidation of certain entities in which equity investors do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties. Reactor Development, LLC was formed for the purpose of developing and managing an energy complex. Alternate Energy Holdings, Inc. invested $1,000,000 which represents approximately 50% of Reactor Development LLC’s capital structure as of December 31, 2007. Furthermore, the daily operating decisions of Reactor Development, LLC are made by the members of Alternate Energy Holdings, Inc.’s management.

Under FASB ASC 810 (Prior authoritative literature FASB Interpretation No. 46 “Consolidation of Variable Interest Entities”) Reactor Development, LLC is deemed a variable Interest Entity to Alternate Energy Holding, Inc. and as such Reactor Development, LLC’s financial information has been consolidated with Alternate Energy Holdings, Inc.

The consolidated financial statements includes the full operating activities of Reactor Development, LLC, with amounts allocated to Reactor Development, LLC disclosed under “Non-Controlling Interest in Variable Interest Entity” in the accompanying consolidated income statement. Assets and liabilities of Reactor Development, LLC were $ -0- and $ -0-, respectively, at December 31, 2011 and December 31, 2010, respectively.

F-14

NOTE 6 – ESCROW

Cash in escrow represents monies held in escrow for a potential funding arrangement that did not materialize. The deposit was returned in January 2012.

NOTE 7 – ASSET HELD FOR SALE

Alternate Energy Holdings, Inc has constructed a model home to demonstrate that a competitively priced and energy cost efficient home can be constructed using energy-efficient techniques. The home creates more power than its uses on a month-to-month basis. The home is to be used to market the Energy Neutral brand name. The home was sold in March 2011.

			Significant Other
	Year Ended		Observable		Total
	12/31/10		Inputs – (Level 2)		Loss
Assets Held for Sale	$	316,418	$	278,000	$	(38,418	)

In accordance with the provisions of the Impairment or Disposal of Long-Lives Assets Subsection of FASB Codification Subtopic 360-10, long-lived assets held and used with a carrying amount of $316,418 were written down to their fair market value of $278,000, resulting in an impairment charge of $38,418, which was included in earnings for the year ended December 31, 2010.

NOTE 8 – AVAILABLE-FOR-SALE-SECURITIES

The Company’s investments consist of equity investments in mutual funds. An investment company is professionally managing the portfolio of the investments. The Company’s investments are classified as available-for sale and bonds in amount of $1,540,655 and $6,916,498 as of December 31, 2011 and 2010, respectively and are recorded on the consolidated balance sheet at fair value based on Level 1 inputs. Unrealized gains and losses on the investments are included as a separate component of other comprehensive income. The Company will recognize an impairment charge if a decline in the fair value of its investments below cost basis is judged to be other-than-temporary. Unrealized losses, included in other comprehensive income at December 31, 2011 and 2010 were $102,439 and $243,773, respectively. Realized Losses from investments for the year ended December 31, 2011 were $444,948. Realized gains from investments were $149,436 for the year ended December 31, 2010.

NOTE 9 – DUE TO EMPLOYEE

In December, 2010 an employee advanced the Company $60,000 to cover working capital. There were no formal repayment terms or interest charged on this advance. The monies were repaid in full in March 2011.

NOTE 10 – LEGAL PROCEEDINGS

Currently, a civil action initiated by the U.S. Securities and Exchange Commission (“SEC”) is pending in the U.S. District Court for the District of Idaho, alleging, among other things, that our Company, an officer and director and another person employed with the company, violated federal securities laws, among other things making false and misleading statements, artificially inflating the Company’s stock price, and subsequently liquidating the stock through secret sales (the “SEC” action). The Company’s accounts were frozen on December 18, 2010 following the filing of the SEC action. However, a federal judge subsequently dropped the freeze on all of the Company’s assets February 4, 2011, that imposed certain other relief pending a final adjudication on the merits of the SEC allegations. The action is currently in the discovery phase and management is unable to determine the likelihood of an unfavorable outcome. The trial is scheduled to occur in October 2012.

F-15

On January 11, 2011, a class action lawsuit was filed in the U.S. District Court of the District of Idaho on behalf of purchases of the common stock of the Company between September 20, 2006 through December 14, 2010, against the Company and an officer and director and another person employed with the Company. On June 17, 2011 an Amended complaint was filed listing Perry Pehlke, Jr. as lead plaintiff. The compliant alleges claims against the Company and an officer and director and a person employed by the Company for violation of Section 10(b) of the Securities Exchange Act of 1934 (the “Exchange Act”) and Rule 10b-5 there under a controlling person claims pursuant to Section 20(a) of the Exchange Act. The compliant seeks compensatory damages for all damages sustained as a result of the defendants’ alleged actions, including reasonable costs and expenses, rescission, and other relief as the Court deems just and proper. The Company believes the lawsuit is without merit and intends to vigorously defend itself. No amounts have been recorded in the consolidated financial statements for this matter as the Company believes it is too early in the proceedings to determine an outcome. Discovery in this case has not begun. The parties are meeting for a mediation session on April 2, 2012

NOTE 11 – CONSTRUCTION IN PROGRESS

Alternate Energy Holdings, Inc. developed a subdivision of five lower cost energy efficient affordable homes in the Panther subdivision in Boise, Idaho that were constructed by a local builder. As of December 31, 2010, $298,657 has been spent on these unsold homes. As of December 31, 2011 all of the homes had been sold.

NOTE 12 - GOING CONCERN

NOTE 13 – SUBSEQUENT EVENTS

In March 2012, we entered into two related agreements with unrelated third parties pursuant to which we will be entitled to receive up to 45,900,000 Euros ($60,190,863 US dollars) in six installment payments over approximately the next 200 days, as described in greater detail below. First, we entered into a Financial Instrument Service Agreement (the “Financial Services Agreement”) with Vital Funds, Inc. (“Vital”). Pursuant to the Financial Services Agreement, Vital, in consideration of payment by us of an initial fee of US$2,575,000, is obligated to arrange for an undisclosed third party to deposit 76.5 million Euros with a bank (the “Issuing Bank”), which is to be Credit Suisse, Zurich, NatWest, London or HSBC Hong Kong, or similar quality bank agreed to by us. The 76.5 million Euros are to be held in a blocked account at the Issuing Bank for one year and a day. On the basis of that deposit the Issuing Bank thereafter is to issue a bank guarantee (“Bank Guarantee”) ($101,984,770 US dollars) in the amount of 76.5 million Euros ($101,984,770 US dollars) for the term of a year and a day. The Bank Guarantee will be issued in favor of AEHI, but expressly for the benefit of Swiss Asset Manager Ltd (“Swiss Asset Manager”). The US$2,575,000 fee we are obligated to pay to Vital has been deposited by us into an escrow account maintained by a third party. Upon proper confirmation of the Bank Guarantee by the bank of Swiss Asset Manager (the “Confirmation”) as outlined in the Financial Services Agreement, Vital shall be entitled to receipt of the US$2,575,000 fee. If the conditions set forth in the Financial Services Agreement are not satisfied, we are entitled to the return of the funds deposited into escrow. We also entered into a separate Project Funding Agreement (the "Funding Agreement") with Swiss Asset Manager regarding the Bank Guarantee. Subject to satisfaction of certain conditions set forth in, and at the times specified in the Funding Agreement, Swiss Asset Manager is obligated to pay us a total of 45,900,000 Euros (61,190,863 US dollars) in six installments in consideration for Swiss Asset Manager's use of the Bank Guarantee. It is anticipated that we could receive the first installment payment from Swiss Asset Manager of 11,475,000 Euros ($15,297,715 US Dollars) fifteen banking days following the Confirmation, with five additional disbursements every thirty banking days thereafter for an aggregate additional amount of approximately 34,425,000 Euros ($45,893,147 US Dollars). There is no guarantee that we will receive all, or any, of the funds we are entitled to under the Funding Agreement. Exchange rates were used as of the date of this filing and may fluctuate at the time of the funding.

F-16